Investor/Analyst Conference Call Scheduled for
Tuesday, February 4 at 10:00 a.m. ET
Post Properties, Inc. (NYSE: PPS) announced today net income
available to common shareholders of $42.8 million, or $0.79 per
diluted share, for the fourth quarter of 2013, compared to $17.9
million, or $0.33 per diluted share, for the fourth quarter of
2012.
Net income available to common shareholders for the year ended
December 31, 2013, was $106.8 million, or $1.96 per diluted share,
compared to net income of $80.3 million, or $1.48 per diluted
share, for the year ended December 31, 2012.
The Company’s net income available to common shareholders for
the three months and year ended December 31, 2013 included a gain
of $28.4 million, or $0.52 per diluted share, on the sale of an
apartment community. The Company’s net income available to common
shareholders for the year ended December 31, 2012 included a gain
of $6.1 million, or $0.11 per diluted share, on the sale of an
asset.
Funds From Operations
The Company uses the National Association of Real Estate
Investment Trusts (“NAREIT”) definition of Funds from Operations
(“FFO”) as an operating measure of the Company’s financial
performance. A reconciliation of FFO to GAAP net income is included
in the financial data (Table 1) accompanying this press
release.
FFO for the fourth quarter of 2013 was $36.4 million, or $0.67
per diluted share, compared to $38.8 million, or $0.71 per diluted
share, for the fourth quarter of 2012. Core FFO for the fourth
quarter of 2013 (excluding FFO from condominium activities) was
$36.0 million, or $0.66 per diluted share, compared to $28.3
million, or $0.52 per diluted share, for the fourth quarter of
2012.
FFO for the year ended December 31, 2013 was $164.8 million, or
$3.01 per diluted share, compared to $154.3 million, or $2.84 per
diluted share, for the year ended December 31, 2012. Core FFO for
the year ended December 31, 2013 (excluding FFO from condominium
activities) was $136.8 million, or $2.50 per diluted share,
compared to $118.1 million, or $2.17 per diluted share, for the
year ended December 31, 2012.
Said Dave Stockert, Post’s CEO, “In 2013, the Company produced
another year of double-digit growth in core funds from operations,
achieved stabilized occupancy on three new projects previously in
development, substantially sold out of the condominium business,
strengthened the balance sheet, and meaningfully increased the
dividend to common shareholders. In these and other ways, the
business has been strengthened and positioned for ongoing
success.”
Same Store Community Data
Average economic occupancy at the Company’s 50 same store
communities, containing 17,999 apartment units, was 95.8% and 95.6%
for the fourth quarter of 2013 and 2012, respectively.
Total revenues for the same store communities increased 3.1% and
total operating expenses increased 6.2% during the fourth quarter
of 2013, compared to the fourth quarter of 2012, resulting in a
1.2% increase in same store net operating income (“NOI”). The
average monthly rental rate per unit increased 2.7% during the
fourth quarter of 2013, compared to the fourth quarter of 2012.
On a sequential basis, total revenues for the same store
communities decreased 0.9% and total operating expenses decreased
2.5%, producing a 0.1% increase in same store NOI for the fourth
quarter of 2013, compared to the third quarter of 2013. On a
sequential basis, the average monthly rental rate per unit
increased 0.2%. For the fourth quarter of 2013, average economic
occupancy at the same store communities was 95.8%, compared to
96.3% for the third quarter of 2013.
For the year ended December 31, 2013, average economic occupancy
at the Company’s same store communities was 95.7%, compared to
96.0% for the year ended December 31, 2012.
Total revenues for the same store communities increased 3.8% and
total operating expenses increased 4.5% for 2013, compared to 2012,
resulting in a 3.4% increase in same store NOI. The average monthly
rental rate per unit increased 4.0% for the year ended December 31,
2013, compared to the year ended December 31, 2012.
Same store NOI is a supplemental non-GAAP financial measure. A
reconciliation of same store NOI to the comparable GAAP financial
measure is included in the financial data (Table 2) accompanying
this press release. Information on same store NOI and average
rental rate per unit by geographic market is also included in the
financial data (Table 3) accompanying this press release.
Investment Activity
Development Activity
In the aggregate, the Company has 1,620 units in five apartment
communities, and approximately 25,464 square feet of retail space,
under development or in lease-up with a total estimated cost of
$260.7 million, and a remaining funding requirement of $93.4
million. The Company believes it has adequate internal resources to
fund its development commitments.
Financing Activity
Leverage, Line and Term Loan Capacity
Total debt and preferred equity as a percentage of undepreciated
real estate assets (adjusted for joint venture partners’ share of
real estate assets and debt) was 36.8% at December 31, 2013.
As of January 31, 2014, the Company had cash and cash
equivalents of $51.1 million. Additionally, the Company had no
outstanding borrowings, and letters of credit totaling $0.4 million
under its combined $330 million unsecured lines of credit. The
Company has no principal debt maturities in 2014.
Computations of debt ratios and reconciliations of the ratios to
the appropriate GAAP measures in the Company’s financial statements
are included in the financial data (Table 4) accompanying this
press release.
Share Repurchase Activity
For the fourth quarter of 2013, the Company repurchased 106,777
shares of its common stock in open market transactions at an
average price per share of approximately $44.34. For the year ended
December 31, 2013, the Company repurchased 550,000 shares of its
common stock in open market transactions at an average price per
share of approximately $45.08. These repurchases, totaling
approximately $4.7 million for the fourth quarter and $24.8 million
for the year ended December 31, 2013, were funded using available
cash balances.
At-the-Market Common Equity Activity
The Company has available an at-the-market (“ATM”) common equity
program that provides for the sale of up to 4 million shares of
common stock. As of December 31, 2013 and to date in 2014, no
shares have been issued under that program. The Company may use its
ATM program, from time to time, as an additional source of capital
and liquidity, to maintain the strength of its balance sheet and to
fund its future investment activities. Sales under this program are
dependent upon a variety of factors, including, among others,
market conditions, the trading price of the Company’s common stock,
the Company’s liquidity position and the potential use of
proceeds.
Information Technology Systems Initiatives
The Company is in the process of upgrading and replacing its
financial and property management information technology systems,
and expects to be completed by the end of 2014. As part of this
project, in addition to other system implementation costs
capitalized, the Company is required to expense certain up-front
implementation and training costs. These expensed system
implementation costs totaled $0.6 million in 2013 and are currently
projected to total $1.3 million in 2014.
2014 Outlook
The estimates and assumptions presented below are forward
looking and are based on the Company’s future view of apartment
markets and of general economic conditions, as well as other risks
outlined below under the caption “Forward-Looking Statements.”
There can be no assurance that the Company’s actual results will
not differ materially from the estimates set forth below. The
Company assumes no obligation to update this guidance in the
future.
Based on its current outlook, the Company anticipates that FFO
per diluted share for the full year 2014 will be in the range set
forth below. The tables below reflect anticipated net gains from
condominium sales (for purposes of this discussion, "Condo FFO")
and FFO before Condo FFO (for purposes of this discussion, "Core
FFO"). Adjusted Funds From Operations (“AFFO”) per share is defined
as FFO per share less operating property capital expenditures after
adjusting for the impact of non-cash straight-line long-term ground
lease expense. Core AFFO represents AFFO excluding net gains from
condominium sales.
Current Outlook FFO AFFO Core
FFO/AFFO $2.55 - $2.62 $2.09 - $2.17 Condo FFO/AFFO $0.00 - $0.01
$0.00 - $0.01 FFO/AFFO $2.55 - $2.63 $2.09 - $2.18
Same
Store Assumptions Revenue 2.30% - 2.80% Operating
expenses 5.00% - 5.50% Net operating income (NOI) 0.30% - 1.40%
The increase in same store operating expenses is largely
attributable to:
- Increases in property taxes of 8%, or
more, due primarily to higher assessed values;
- Increases in personnel expenses of 5%,
or more, largely reversing the unbudgeted reduction in these costs
that occurred in 2013, and accounting for modest increases in
salary and benefit costs for on-site personnel; and
- Increases in expensed repair and
maintenance costs of 7%, or more, due to the Company’s plans to
paint the exteriors of more properties in 2014 in order to preserve
asset quality.
The above estimates of FFO and AFFO per diluted share are also
based on the following assumptions:
- Projected net operating income from
newly stabilized properties and lease up properties, net of
operating deficits, expected to contribute approximately $0.11 per
diluted share at the mid-point of the estimated range of Core
FFO;
- In the aggregate, projected 1-2%
increase in general and administrative expenses, corporate property
management expenses, and investment and development expenses
(before amounts capitalized to development projects);
- Projected decrease in capitalized
interest and development overhead costs, expected to cause Core FFO
to decline by approximately $0.04 per diluted share;
- Projected development expenditures of
approximately $60 million to $70 million, including roughly $100
million of planned development starts in the latter half of the
year, expected to be funded in 2014 with available cash and
operating cash flow;
- Projected expensed, up-front
implementation and training costs relating to technology system
upgrades of just over $0.02 per diluted share ($1.3 million
estimate);
- Projected casualty losses from pipe and
water damage sustained during the recent heavy freeze in January
2014 of just over $0.01 per diluted share ($750,000 estimate);
- Projected decrease of annually
recurring and periodically recurring capital expenditures from
$30.6 million in 2013 to roughly $25 million in 2014.
- Projected weighted average diluted
shares of approximately 54.5 million for the full year 2014, with
no share issuances under the Company’s ATM program required to fund
the investment activity included in the earnings guidance
above.
The Company anticipates that net income available to common
shareholders will be in the range of $0.87 to $0.99 per diluted
share for the full year 2014. The difference between net income
available to common shareholders and FFO per diluted share is
depreciation on real estate assets, which is anticipated to be
$1.64 to $1.68 per diluted share. The difference between FFO and
AFFO per diluted share is operating property capital expenditures
after adjusting for the impact of non-cash straight-line long-term
ground lease expense, which is anticipated to be $0.45 to $0.46 per
diluted share.
Planned Asset Sales Activity
The Company’s earnings guidance above does not currently factor
in any disposition activities during 2014. The Company plans,
however, to market for sale $200 million to $250 million of
apartment assets during 2014, the proceeds of which may be used to
prepay indebtedness, pay any special dividends necessary to
distribute its taxable earnings, to fund future investment
activities, including funding development activities and possible
share repurchases, and otherwise for general corporate purposes.
Sales of assets and any payment of special dividends or prepayment
of indebtedness could be dilutive to the Company’s earnings
guidance depending on the timing and amount of sales and the use
and timing of net proceeds received; however, management intends to
pursue reinvestment opportunities to mitigate dilution to earnings
and cash flow, and to maintain the strength of the balance sheet.
There can be no assurances that these sales will occur or that the
use of proceeds may not change.
Supplemental Financial Data
The Company also produces Supplemental Financial Data that
includes detailed information regarding the Company’s operating
results, investment activity, financing activity, balance sheet and
properties. This Supplemental Financial Data is considered an
integral part of this earnings release and is available on the
Company’s website. The Company’s Earnings Release and the
Supplemental Financial Data are available through the
Investors/Financial Reports/Quarterly and Other Reports section of
the Company’s website at www.postproperties.com.
The ability to access the attachments on the Company’s website
requires the Adobe Acrobat Reader, which may be downloaded at
http://get.adobe.com/reader/.
Non-GAAP Financial Measures and Other Defined Terms
The Company uses certain non-GAAP financial measures and other
defined terms in this press release and in its Supplemental
Financial Data available on the Company’s website. The non-GAAP
financial measures include FFO, Adjusted Funds from Operations
(“AFFO”), net operating income, same store capital expenditures,
and certain debt statistics and ratios. The definitions of these
non-GAAP financial measures are listed below and on page 19 of the
Supplemental Financial Data. The Company believes that these
measures are helpful to investors in measuring financial
performance and/or liquidity and comparing such performance and/or
liquidity to other REITs.
Funds from Operations – The Company uses FFO as an operating
measure. The Company uses the NAREIT definition of FFO. FFO is
defined by NAREIT to mean net income (loss) available to common
shareholders determined in accordance with GAAP, excluding gains
(or losses) from extraordinary items and sales of depreciable
operating property, plus depreciation and amortization of real
estate assets, and after adjustment for unconsolidated partnerships
and joint ventures all determined on a consistent basis in
accordance with GAAP. FFO presented in the Company’s press release
and Supplemental Financial Data is not necessarily comparable to
FFO presented by other real estate companies because not all real
estate companies use the same definition. The Company’s FFO is
comparable to the FFO of real estate companies that use the current
NAREIT definition.
Accounting for real estate assets using historical cost
accounting under GAAP assumes that the value of real estate assets
diminishes predictably over time. NAREIT stated in its April 2002
White Paper on Funds from Operations that “since real estate asset
values have historically risen or fallen with market conditions,
many industry investors have considered presentations of operating
results for real estate companies that use historical cost
accounting to be insufficient by themselves.” As a result, the
concept of FFO was created by NAREIT for the REIT industry to
provide an alternate measure. Since the Company agrees with the
concept of FFO and appreciates the reasons surrounding its
creation, the Company believes that FFO is an important
supplemental measure of operating performance. In addition, since
most equity REITs provide FFO information to the investment
community, the Company believes that FFO is a useful supplemental
measure for comparing the Company’s results to those of other
equity REITs. The Company believes that the line on its
consolidated statement of operations entitled “net income available
to common shareholders” is the most directly comparable GAAP
measure to FFO.
Adjusted Funds From Operations – The Company also uses AFFO as
an operating measure. AFFO is defined as FFO less operating capital
expenditures and after adjusting for the impact of non-cash
straight-line long-term ground lease expense, non-cash impairment
charges, debt extinguishment gains (losses) and preferred stock
redemption costs. The Company believes that AFFO is an important
supplemental measure of operating performance for an equity REIT
because it provides investors with an indication of the REIT’s
ability to fund its operating capital expenditures through
earnings. In addition, since most equity REITs provide AFFO
information to the investment community, the Company believes that
AFFO is a useful supplemental measure for comparing the Company to
other equity REITs. The Company believes that the line on its
consolidated statement of operations entitled “net income available
to common shareholders” is the most directly comparable GAAP
measure to AFFO.
Property Net Operating Income (“NOI”) – The Company uses
property NOI, including same store NOI and same store NOI by
market, as an operating measure. NOI is defined as rental and other
revenues from real estate operations less total property and
maintenance expenses from real estate operations (exclusive of
depreciation and amortization). The Company believes that NOI is an
important supplemental measure of operating performance for a
REIT’s operating real estate because it provides a measure of the
core operations, rather than factoring in depreciation and
amortization, financing costs and general and administrative
expenses generally incurred at the corporate level. This measure is
particularly useful, in the opinion of the Company, in evaluating
the performance of geographic operations, same store groupings and
individual properties. Additionally, the Company believes that NOI,
as defined, is a widely accepted measure of comparative operating
performance in the real estate investment community. The Company
believes that the line on its consolidated statement of operations
entitled “net income” is the most directly comparable GAAP measure
to NOI.
Same Store Capital Expenditures – The Company uses same store
annually recurring and periodically recurring capital expenditures
as cash flow measures. Same store annually recurring and
periodically recurring capital expenditures are supplemental
non-GAAP financial measures. The Company believes that same store
annually recurring and periodically recurring capital expenditures
are important indicators of the costs incurred by the Company in
maintaining its same store communities on an ongoing basis. The
corresponding GAAP measures include information with respect to the
Company’s other operating segments consisting of communities
stabilized in the prior year, lease-up communities, rehabilitation
properties, sold properties and commercial properties in addition
to same store information. Therefore, the Company believes that the
Company’s presentation of same store annually recurring and
periodically recurring capital expenditures is necessary to
demonstrate same store replacement costs over time. The Company
believes that the most directly comparable GAAP measure to same
store annually recurring and periodically recurring capital
expenditures is the line on the Company’s consolidated statements
of cash flows entitled “property capital expenditures,” which also
includes revenue generating capital expenditures.
Debt Statistics and Debt Ratios – The Company uses a number of
debt statistics and ratios as supplemental measures of liquidity.
The numerator and/or the denominator of certain of these statistics
and/or ratios include non-GAAP financial measures that have been
reconciled to the most directly comparable GAAP financial measure.
These debt statistics and ratios include: (1) interest coverage
ratios; (2) fixed charge coverage ratios; (3) total debt as a
percentage of undepreciated real estate assets (adjusted for joint
venture partner’s share of debt); (4) total debt plus preferred
equity as a percentage of undepreciated real estate assets
(adjusted for joint venture partner’s share of debt); (5) a ratio
of consolidated debt to total assets; (6) a ratio of secured debt
to total assets; (7) a ratio of total unencumbered assets to
unsecured debt; (8) a ratio of consolidated income available for
debt service to annual debt service charge; and (9) a debt to
annualized income available for debt service ratio. A number of
these debt statistics and ratios are derived from covenants found
in the Company’s debt agreements, including, among others, the
Company’s senior unsecured notes. In addition, the Company presents
these measures because the degree of leverage could affect the
Company’s ability to obtain additional financing for working
capital, capital expenditures, acquisitions, development or other
general corporate purposes. The Company uses these measures
internally as an indicator of liquidity, and the Company believes
that these measures are also utilized by the investment and analyst
communities to better understand the Company’s liquidity.
The Company uses income available for debt service to calculate
certain debt ratios and statistics. Income available for debt
service is defined as net income (loss) before interest, taxes,
depreciation, amortization, gains on sales of real estate assets,
non-cash impairment charges and other non-cash income and expenses.
Income available for debt service is a supplemental measure of
operating performance that does not represent and should not be
considered as an alternative to net income or cash flow from
operating activities as determined under GAAP, and the Company’s
calculation thereof may not be comparable to similar measures
reported by other companies, including EBITDA or Adjusted
EBITDA.
Property Operating Statistics – The Company uses average
economic occupancy, gross turnover, net turnover and percentage
increases in rent for new and renewed leases as statistical
measures of property operating performance. The Company defines
average economic occupancy as gross potential rent less vacancy
losses, model expenses and bad debt expenses divided by gross
potential rent for the period, expressed as a percentage. Gross
turnover is defined as the percentage of leases expiring during the
period that are not renewed by the existing residents. Net turnover
is defined as gross turnover decreased by the percentage of
expiring leases where the residents transfer to a new apartment
unit in the same community or in another Post® community. The
percentage increases in rent for new and renewed leases are
calculated using the respective new or renewed rental rate as of
the date of a new lease, as compared with the previous rental rate
on that same unit.
Conference Call Information
The Company will hold its quarterly conference call on Tuesday,
February 4, at 10:00 a.m. ET. The telephone numbers are
888-364-3108 for US and Canada callers and 719-325-2361 for
international callers. The access code is 6907082. The conference
call will be open to the public and can be listened to live on
Post’s website at www.postproperties.com. Click Investors in the
top menu, then select either Investor’s Overview or Events
Calendar. The replay will begin at 1:00 p.m. ET on Tuesday,
February 4, and will be available until Tuesday, February 11, at
1:00 p.m. ET. The telephone numbers for the replay are 888-203-1112
for US and Canada callers and 719-457-0820 for international
callers. The access code for the replay is 6907082. A replay of the
call also will be archived on Post’s website under Investors/Audio
Archives.
About Post
Post Properties, founded more than 40 years ago, is a leading
developer and operator of upscale multifamily communities. The
Company’s mission is delivering superior satisfaction and value to
its residents, associates, and investors, with a vision of being
the first choice in quality multifamily living. Operating as a real
estate investment trust (“REIT”), the Company focuses on developing
and managing Post® branded high density urban and resort-style
garden apartments. Post Properties is headquartered in Atlanta,
Georgia, and has operations in ten markets across the country.
Post Properties has interests in 22,516 apartment units in 60
communities, including 1,471 apartment units in four communities
held in unconsolidated entities and 1,620 apartment units in five
communities currently under development or in lease-up.
Forward-Looking Statements
Certain statements made in this press release and other written
or oral statements made by or on behalf of the Company, may
constitute “forward-looking statements” within the meaning of the
federal securities laws. Statements regarding future events and
developments and the Company’s future performance, as well as
management’s expectations, beliefs, plans, estimates or projections
relating to the future, are forward-looking statements within the
meaning of these laws. Examples of such statements in this press
release include, expectations regarding apartment market
conditions, expectations regarding future operating conditions,
including the Company’s current outlook as to expected funds from
operations, adjusted funds from operations, revenue, operating
expenses, net operating income, capital expenditures, depreciation,
gains on sales and net income, anticipated development activities
(including projected construction expenditures and timing),
expectations regarding the for-sale condominium business,
expectations regarding apartment community sales and the use of
proceeds thereof, expectations regarding use of proceeds from
unsecured bank credit facilities, and expectations regarding
offerings of the Company’s common stock and the use of proceeds
thereof. All forward-looking statements are subject to certain
risks and uncertainties that could cause actual events to differ
materially from those projected. Management believes that these
forward-looking statements are reasonable; however, you should not
place undue reliance on such statements. These statements are based
on current expectations and speak only 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.
The following are some of the factors that could cause the
Company’s actual results and its expectations to differ materially
from those described in the Company’s forward-looking statements:
the success of the Company’s business strategies discussed in its
Annual Report on Form 10-K for the year ended December 31, 2012 and
in subsequent filings with the SEC; conditions affecting ownership
of residential real estate and general conditions in the
multi-family residential real estate market; uncertainties
associated with the Company’s real estate development and
construction; uncertainties associated with the timing and amount
of apartment community sales; exposure to economic and other
competitive factors due to market concentration; future local and
national economic conditions, including changes in job growth,
interest rates, the availability of mortgage and other financing
and related factors; the Company’s ability to generate sufficient
cash flows to make required payments associated with its debt
financing; the effects of the Company’s leverage on its risk of
default and debt service requirements; the impact of a downgrade in
the credit rating of the Company’s securities; the effects of a
default by the Company or its subsidiaries on an obligation to
repay outstanding indebtedness, including cross-defaults and
cross-acceleration under other indebtedness; the effects of
covenants of the Company’s or its subsidiaries’ mortgage
indebtedness on operational flexibility and default risks; the
Company’s ability to maintain its current dividend level;
uncertainties associated with the Company’s condominium for-sale
housing business, including warranty and related obligations; the
impact of any additional charges the Company may be required to
record in the future related to any impairment in the carrying
value of its assets; the impact of competition on the Company’s
business, including competition for residents in the Company’s
apartment communities and for development locations; the Company’s
ability to compete for limited investment opportunities; the
effects of any decision by the government to eliminate Fannie Mae
or Freddie Mac or reduce government support for apartment mortgage
loans; the effects of changing interest rates and effectiveness of
interest rate hedging contracts; the success of the Company’s
acquired apartment communities; the Company’s ability to succeed in
new markets; the costs associated with compliance with laws
requiring access to the Company’s properties by persons with
disabilities; the impact of the Company’s ongoing litigation with
the U.S. Department of Justice regarding the Americans with
Disabilities Act and the Fair Housing Act as well as the impact of
other litigation; the effects of losses from natural catastrophes
in excess of insurance coverage; uncertainties associated with
environmental and other regulatory matters; the costs associated
with moisture infiltration and resulting mold remediation; the
Company’s ability to control joint ventures, properties in which it
has joint ownership and corporations and limited partnership in
which it has partial interests; the Company’s ability to renew
leases or relet units as leases expire; the Company’s ability to
continue to qualify as a REIT under the Internal Revenue Code; the
effects of changes in accounting policies and other regulatory
matters detailed in the Company’s filings with the Securities and
Exchange Commission; increased costs arising from health care
reform; and any breach of the Company’s privacy or information
security systems. Other important risk factors regarding the
Company are included under the caption “Risk Factors” in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2012 and may be discussed in subsequent filings with the SEC.
The risk factors discussed in the Form 10-K under the caption “Risk
Factors” are specifically incorporated by reference into this press
release.
Financial Highlights
(Unaudited; in thousands, except per share
and unit amounts)
Three months ended
Year ended December 31, December 31,
2013 2012 2013
2012 OPERATING DATA Total revenues $ 93,705 $ 84,924 $
362,737 $ 330,334 Net income available to common shareholders $
42,809 $ 17,931 $ 106,846 $ 80,251
Funds from operations available to common
shareholders and unitholders (Table 1)
$ 36,449 $ 38,828 $ 164,750 $ 154,349 Weighted average
shares outstanding - diluted 54,208 54,518 54,508 54,131 Weighted
average shares and units outstanding - diluted 54,346 54,661 54,650
54,278 PER COMMON SHARE DATA - DILUTED Net income available
to common shareholders $ 0.79 $ 0.33 $ 1.96 $ 1.48
Funds from operations available to common
shareholders and unitholders (Table 1) (1)
$ 0.67 $ 0.71 $ 3.01 $ 2.84 Dividends declared $ 0.33 $ 0.25
$ 1.24 $ 0.97 1) Funds from operations available to
common shareholders and unitholders per share was computed using
weighted average shares and units outstanding, including the impact
of dilutive securities totaling 133 and 218 for the three months
and 172 and 310 for the years ended December 31, 2013 and 2012,
respectively. Additionally, diluted weighted average shares and
units included the impact of non-vested shares and units totaling
120 and 129 for the three months and 120 and 127 for the years
ended December 31, 2013 and 2012, respectively, for the computation
of FFO per share. Such non-vested shares and units are considered
in the income per share computations under GAAP using the
“two-class method.”
Table 1
Reconciliation of Net Income Available to
Common Shareholders to
Funds From Operations Available to Common
Shareholders and Unitholders
(Unaudited; in thousands, except per share
and unit amounts)
Three months ended Year
ended December 31, December 31, 2013
2012 2013 2012
Net income available to common shareholders $ 42,809 $
17,931 $ 106,846 $ 80,251 Noncontrolling interests - Operating
Partnership 112 42 279 217 Depreciation on consolidated real estate
assets, net 21,616 20,566 84,841 78,737
Depreciation on real estate assets held in
unconsolidated entities
292 289 1,164 1,199 Gain on sale of apartment community (28,380 ) -
(28,380 ) -
Gain on sale of apartment community -
unconsolidated entities
- - - (6,055 )
Funds from operations available to
common shareholders and unitholders
$ 36,449 $ 38,828 $ 164,750 $ 154,349
Funds from operations available to common
shareholders and unitholders - core operations
$ 35,973 $ 28,250 $ 136,806 $ 118,076
Funds from operations available to common
shareholders and unitholders - condominiums
476 10,578 27,944 36,273
Funds from operations available to
common shareholders and unitholders
$ 36,449 $ 38,828 $ 164,750 $ 154,349
Funds from operations - per share and unit - diluted (1) $
0.67 $ 0.71 $ 3.01 $ 2.84
Funds from
operations per share and unit - core operations $ 0.66 $
0.52 $ 2.50 $ 2.17
Weighted average shares and
units outstanding - diluted (1) 54,466
54,790 54,770 54,405 1) Diluted
weighted average shares and units include the impact of dilutive
securities totaling 133 and 218 for the three months and 172 and
310 for the years ended December 31, 2013 and 2012, respectively.
Additionally, diluted weighted average shares and units included
the impact of non-vested shares and units totaling 120 and 129 for
the three months and 120 and 127 for the years ended December 31,
2013 and 2012, respectively, for the computation of FFO per share.
Such non-vested shares and units are considered in the income per
share computations under GAAP using the “two-class method.”
Table 2
Reconciliation of Same Store Net Operating
Income (NOI) to GAAP Net Income
(Unaudited; In thousands)
Three months ended Year ended December 31,
December 31, September 30, December
31, December 31, 2013 2012 2013
2013 2012 Total same store NOI $ 48,416 $ 47,825 $
48,374 $ 192,263 $ 186,008 Property NOI from other operating
segments 5,547 894 4,529
14,341 1,701 Consolidated property NOI
53,963 48,719 52,903
206,604 187,709 Add (subtract):
Interest income 10 34 8 77 393 Other revenues 204 213 225 872 850
Depreciation (21,914 ) (20,795 ) (21,580 ) (85,608 ) (79,367 )
Interest expense (11,424 ) (11,755 ) (11,186 ) (44,704 ) (46,028 )
Amortization of deferred financing costs (658 ) (669 ) (646 )
(2,573 ) (2,695 ) General and administrative (4,751 ) (4,411 )
(4,079 ) (17,245 ) (16,342 ) Investment and development (307 ) (312
) (367 ) (1,755 ) (1,317 ) Other investment costs (85 ) (242 ) (418
) (1,324 ) (1,401 ) Severance, impairment and other (436 ) - (1,981
) (2,417 ) - Gains on condominium sales activities, net 476 10,578
5,293 27,944 36,273
Equity in income of unconsolidated real
estate entities, net
479 579 656 2,090 7,995 Other income (expense), net (195 ) 590 (196
) (839 ) 1,034 Net loss on extinguishment of indebtedness -
(4,017 ) - -
(4,318 ) Income from continuing operations 15,362 18,512
18,632 81,122 82,786 Income from discontinued operations
28,501 422 421 29,798
1,505 Net income $ 43,863 $
18,934 $ 19,053 $ 110,920 $ 84,291
Table 3
Same Store Net Operating Income (NOI) and
Average Rental Rate per Unit by Market
(In thousands)
Three months
ended Q4 '13 Q4 '13 Q4 '13 December
31, December 31, September 30, vs. Q4
'12 vs. Q3 '13 % Same 2013 2012
2013 % Change % Change Store NOI Rental
and other revenues Atlanta $ 20,682 $ 19,630 $ 20,765 5.4% (0.4)%
Dallas 17,604 17,084 17,867 3.0% (1.5)% Houston 3,737 3,453 3,720
8.2% 0.5% Austin 2,990 2,823 3,008 5.9% (0.6)% Washington, D.C.
12,990 13,180 13,226 (1.4)% (1.8)% New York 3,834 3,704 3,743 3.5%
2.4% Tampa 9,100 8,851 9,207 2.8% (1.2)% Orlando 2,747 2,778 2,804
(1.1)% (2.0)% Charlotte 5,112 4,930 5,204 3.7%
(1.8)% Total rental and other revenues 78,796 76,433
79,544 3.1% (0.9)%
Property operating and maintenance
expenses (exclusive of depreciation and amortization)
Atlanta 8,068 7,804 8,328 3.4% (3.1)% Dallas 7,370 6,755 7,674 9.1%
(4.0)% Houston 1,490 1,341 1,487 11.1% 0.2% Austin 1,274 1,175
1,344 8.4% (5.2)% Washington, D.C. 4,358 4,147 4,478 5.1% (2.7)%
New York 1,968 1,662 1,867 18.4% 5.4% Tampa 3,261 3,169 3,404 2.9%
(4.2)% Orlando 927 967 937 (4.1)% (1.1)% Charlotte 1,664
1,588 1,651 4.8% 0.8% Total 30,380
28,608 31,170 6.2% (2.5)% Net operating income
Atlanta 12,614 11,826 12,437 6.7% 1.4% 26.1% Dallas 10,234 10,329
10,193 (0.9)% 0.4% 21.1% Houston 2,247 2,112 2,233 6.4% 0.6% 4.6%
Austin 1,716 1,648 1,664 4.1% 3.1% 3.5% Washington, D.C. 8,632
9,033 8,748 (4.4)% (1.3)% 17.8% New York 1,866 2,042 1,876 (8.6)%
(0.5)% 3.9% Tampa 5,839 5,682 5,803 2.8% 0.6% 12.1% Orlando 1,820
1,811 1,867 0.5% (2.5)% 3.8% Charlotte 3,448 3,342
3,553 3.2% (3.0)% 7.1% Total same store NOI $ 48,416 $
47,825 $ 48,374 1.2% 0.1% 100.0% Average rental rate
per unit Atlanta $ 1,296 $ 1,238 $ 1,281 4.7% 1.2% Dallas 1,228
1,192 1,225 3.0% 0.2% Houston 1,440 1,366 1,428 5.4% 0.9% Austin
1,544 1,475 1,535 4.7% 0.6% Washington, D.C. 1,875 1,889 1,896
(0.7)% (1.1)% New York 3,910 3,856 3,883 1.4% 0.7% Tampa 1,396
1,361 1,400 2.6% (0.3)% Orlando 1,490 1,502 1,513 (0.8)% (1.5)%
Charlotte 1,221 1,182 1,212 3.3% 0.7% Total average rental rate per
unit 1,429 1,391 1,426 2.7% 0.2%
Table 3 (con’t)
Same Store Net Operating Income (NOI) and
Average Rental Rate per Unit by Market
(In thousands)
Year ended
December 31, December 31, 2013 2012
% Change Rental and other revenues Atlanta $ 81,466 $ 77,503
5.1% Dallas 70,103 67,436 4.0% Houston 14,650 13,504 8.5% Austin
11,826 11,130 6.3% Washington, D.C. 52,456 52,426 0.1% New York
14,909 14,683 1.5% Tampa 36,441 34,839 4.6% Orlando 11,130 10,927
1.9% Charlotte 20,431 19,451 5.0% Total rental and
other revenues 313,412 301,899 3.8%
Property operating and maintenance
expenses (exclusive of depreciation and amortization)
Atlanta 32,456 30,850 5.2% Dallas 29,609 28,479 4.0% Houston 5,809
5,393 7.7% Austin 5,041 4,819 4.6% Washington, D.C. 17,313 16,274
6.4% New York 7,162 6,567 9.1% Tampa 13,288 12,871 3.2% Orlando
3,887 4,013 (3.1)% Charlotte 6,584 6,625 (0.6)% Total
121,149 115,891 4.5% Net operating income
Atlanta 49,010 46,653 5.1% Dallas 40,494 38,957 3.9% Houston 8,841
8,111 9.0% Austin 6,785 6,311 7.5% Washington, D.C. 35,143 36,152
(2.8)% New York 7,747 8,116 (4.5)% Tampa 23,153 21,968 5.4% Orlando
7,243 6,914 4.8% Charlotte 13,847 12,826 8.0% Total
same store NOI $ 192,263 $ 186,008 3.4% Average
rental rate per unit Atlanta $ 1,271 $ 1,209 5.1% Dallas 1,216
1,168 4.1% Houston 1,412 1,315 7.4% Austin 1,519 1,441 5.4%
Washington, D.C. 1,889 1,868 1.1% New York 3,884 3,800 2.2% Tampa
1,388 1,332 4.2% Orlando 1,508 1,465 2.9% Charlotte 1,202 1,146
4.9% Total average rental rate per unit 1,416 1,362 4.0%
Table 4
Computation of Debt Ratios
(In thousands)
As of December 31, 2013
2012 Total real estate assets per balance sheet $ 2,251,139
$ 2,191,708 Plus: Company share of real estate assets held in
unconsolidated entities 57,680 58,726 Company share of accumulated
depreciation - assets held in unconsolidated entities 12,645 11,158
Accumulated depreciation per balance sheet 913,018
842,925 Total undepreciated real estate assets
(A) $ 3,234,482 $ 3,104,517 Total debt
per balance sheet $ 1,098,734 $ 1,102,464 Plus: Company share of
third party debt held in unconsolidated entities 49,531
49,531 Total debt (adjusted for joint venture
partners' share of debt)
(B) $ 1,148,265 $ 1,151,995
Total debt as a % of undepreciated real
estate assets (adjusted for joint venture partners' share of debt)
(B÷A)
35.5 % 37.1 % Total debt per balance sheet $
1,098,734 $ 1,102,464 Plus: Company share of third party debt held
in unconsolidated entities 49,531 49,531 Preferred shares at
liquidation value 43,392 43,392
Total debt and preferred equity (adjusted
for joint venture partners' share of debt) (C)
$ 1,191,657 $ 1,195,387
Total debt and preferred equity as a % of
undepreciated real estate assets (adjusted for joint venture
partners' share of debt) (C÷A)
36.8 % 38.5 %
Post Properties, Inc.Chris Papa, 404-846-5028
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