GGP Reports Second Quarter 2017 Results and Declares Third Quarter Dividend

Wednesday, August 2, 2017 5:30 am CDT

Dateline:

CHICAGO

Public Company Information:

NYSE:
GGP
us3700231034

CHICAGO--(BUSINESS WIRE)--GGP Inc. (the “Company” or “GGP”) (NYSE: GGP) today reported results for the three and six months ended June 30, 2017.

GAAP Operating Results

  • For the three months ended June 30, 2017, net income attributable to GGP was $126 million, or $0.13 per diluted share, as compared to $186 million, or $0.19 per diluted share, in the prior year period. For the six months ended June 30, 2017, net income attributable to GGP was $233 million, or $0.24 per diluted share, as compared to $378 million, or $0.39 per diluted share, in the prior year period.
  • Net income attributable to GGP decreased 32.3% from the prior year period primarily due to 2016 gains related to the sale of interests in two properties.
  • The Company declared a third quarter common stock dividend of $0.22 per share, an increase of 10% over the third quarter of 2016.

Company Operating Results

  • Company Same Store Net Operating Income (“Company Same Store NOI”) increased 0.7% and 1.6% from the prior year period for the three and six months ended June 30, 2017, respectively.
  • For the three months ended June 30, 2017, Company Net Operating Income (“Company NOI”) as adjusted was $551 million as compared to $544 million in the prior year period, an increase of 1.3%. For the six months ended June 30, 2017, Company NOI as adjusted was $1.11 billion as compared to $1.09 billion, an increase of 2.2%.1
  • For the three months ended June 30, 2017, Company Earnings Before Interest, Taxes, Depreciation and Amortization (“Company EBITDA”) as adjusted was $507 million as compared to $502 million in the prior year period, an increase of 1.1%. For the six months ended June 30, 2017, Company EBITDA as adjusted was $1.03 billion as compared to $1.01 billion, an increase of 2.5%.1
  • For the three months ended June 30, 2017, Company Funds From Operations (“Company FFO”) was $335 million, or $0.35 per diluted share, as compared to $340 million, or $0.35 per diluted share, in the prior year period. For the six months ended June 30, 2017, Company FFO was $681 million, or $0.71 per diluted share, as compared to $723 million, or $0.75 per diluted share, in the prior year period.
  • Same Store leased percentage was 95.7% at quarter end.
  • Initial NOI weighted rental rates for signed leases that have commenced in the trailing twelve months on a suite-to-suite basis increased 13.4% when compared to the rental rate for expiring leases.
  • For the trailing twelve months, NOI weighted tenant sales per square foot (<10K sf) were $705 an increase of 1.7% over the prior year.
  • Tenant sales (all less anchors) increased 0.8% on a trailing 12-month basis, excluding apparel the increase is 3.1%.

1. See Supplemental Information page 4 for items included as adjustments.

Investment Activities

Development

The Company’s development and redevelopment activities total $1.5 billion, of which approximately $1.3 billion is under construction and $0.2 billion is in the pipeline.

Acquisitions

In the second quarter, the Company acquired its joint venture partner’s interest in Neshaminy Mall in Bensalem, Pennsylvania, and the Younkers anchor box at Jordan Creek Town Center in West Des Moines, Iowa.

The Company received an additional 7.3% of its joint venture partner's membership interests in Miami Design District for two promissory notes totaling $98 million, resulting in a total ownership of 22.3%.

The Company received a 10% joint venture membership interest in 522 Fifth Avenue for a $9.0 million promissory note.

Subsequent to quarter end, the Company closed on two transactions with Seritage Growth Properties for gross consideration of $247.6 million. Pursuant to the transactions, the Company (i) acquired the remaining 50% interest in eight of the 12 assets in the existing joint venture between the two companies for $190.1 million; and (ii) acquired a 50% joint venture interest in five additional assets for $57.5 million.

Dispositions

The Company sold Red Cliffs Mall in St. George, Utah, for approximately $39.1 million.

The Company completed its disposition of Lakeside Mall.

Financing Activities

Subsequent to quarter end, the Company obtained $325 million of new fixed rate debt with term to maturity of 10.0 years and an interest rate of 3.98%.

Subsequent to quarter end, the Company received a $20 million payment on a promissory note from its joint venture partner.

Dividends

On August 2, 2017, the Company’s Board of Directors declared a third quarter common stock dividend of $0.22 per share payable on October 31, 2017, to stockholders of record on October 13, 2017. This represents an increase of $0.02 per share or 10% growth over the dividend declared for the third quarter of 2016.

The Board of Directors also declared a quarterly dividend on the 6.375% Series A Cumulative Redeemable Preferred Stock of $0.3984 per share payable on October 2, 2017, to stockholders of record on September 15, 2017.

Guidance

    For the three
For the year ending months ending
Earnings Guidance December 31, 2017     September 30, 2017
         
Net income attributable to GGP $0.58- $0.62     $0.11- $0.13
Preferred stock dividends (0.02)     (0.01)
Net income attributable to common stockholders $0.56 - $0.60     $0.10 - $0.12
Loss (gain) from changes in control and other 0.02     -
Depreciation, including share of JVs 1.01     0.25
NAREIT FFO $1.59 - $1.63     $0.35 - $0.37
Adjustments 1 (0.03)     0.01
Company FFO per diluted share $1.56 - $1.60     $0.36 - $0.38
1.   Includes impact of straight-line rent, above/below market rent, gain/loss on foreign currency and other items. For discussion on the purpose and use of these adjustments please see the Non-GAAP Supplemental Financial Measures and Definitions section on page ER7.

The guidance estimate reflects management’s view of current and future market conditions, including assumptions with respect to Company Same Store NOI and Operating Income growth, rental rates, occupancy levels, retail sales, variable expenses, interest rates and the earnings impact of the events referenced in this release and previously disclosed. The guidance also reflects management’s view of capital market conditions. The estimates do not include future gains or losses, or the impact on operating results from future property acquisitions or dispositions or capital market activity. Earnings per share estimates may be subject to fluctuations as a result of several factors, including any gains or losses associated with disposition activity. By definition, FFO and Company FFO exclude real estate-related depreciation and amortization, provisions for impairment, or gains or losses associated with property disposition activities. This guidance is a forward-looking statement and is subject to the risks and other factors described elsewhere in this release and in the Company’s annual and quarterly periodic reports filed with the Securities and Exchange Commission.

Investor Conference Call

On Wednesday, August 2, 2017, the Company will host a conference call at 8:00 a.m. Central (9:00 a.m. Eastern). The conference call will be accessible by telephone and through the Internet. Interested parties can access the call by dialing 877.845.1018 (international 707.287.9345). A live webcast of the conference call will be available in listen-only mode in the Investors section at www.ggp.com. Interested parties should access the conference call or website 10 minutes prior to the beginning of the call in order to register. For those unable to listen to the call live, a replay will be available after the conference call event. To access the replay, dial 855.859.2056 (international 404.537.3406) conference ID 44508800.

Supplemental Information

The Company has prepared a supplemental information report available on www.ggp.com in the Investors section. This information also has been furnished with the Securities and Exchange Commission as an exhibit on Form 8-K.

Forward-Looking Statements

Certain statements made in this press release may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in any forward-looking statement are based on reasonable assumptions, it can give no assurance that its expectations will be attained, and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors. Such factors include, but are not limited to, the Company’s ability to refinance, extend, restructure or repay near and intermediate term debt, its indebtedness, its ability to raise capital through equity issuances, asset sales or the incurrence of new debt, retail and credit market conditions, impairments, its liquidity demands, and economic conditions. The Company discusses these and other risks and uncertainties in its annual and quarterly periodic reports filed with the Securities and Exchange Commission. The Company may update that discussion in its periodic reports, but otherwise takes no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Investors and others should note that we post our current Investor Presentation on the Investors page of our website at www.ggp.com. From time to time, we update that Investor Presentation and when we do, it will be posted on the Investors page of our website at ggp.com. It is possible that the updates could include information deemed to be material information. Therefore, we encourage investors, the media and others interested in our company to review the information we post on the Investors page of our website at www.investor.ggp.com from time to time.

GGP Inc.

GGP Inc. is an S&P 500 company focused exclusively on owning, managing, leasing and redeveloping high-quality retail properties throughout the United States. GGP is headquartered in Chicago, Illinois, and publicly traded on the NYSE under the symbol GGP.

Non-GAAP Supplemental Financial Measures and Definitions

Proportionate or At Share Basis

The following Non-GAAP supplemental financial measures are all presented on a proportionate basis. The proportionate financial information presents the consolidated and unconsolidated properties at the Company’s ownership percentage or “at share”. This form of presentation offers insights into the financial performance and condition of the Company as a whole, given the significance of the Company’s unconsolidated property operations that are owned through investments accounted for under GAAP using the equity method.

The proportionate financial information is not, and is not intended to be, a presentation in accordance with GAAP. The non-GAAP proportionate financial information reflects our proportionate economic ownership of each asset in our property portfolio that we do not wholly own. The amounts in the column labeled "Noncontrolling Interests" were derived on a property-by-property basis by including the share attributable to noncontrolling interests in each line item from each individual property. The Company does not have legal claim to the noncontrolling interest of assets, liabilities, revenue, and expenses. The amount of cash each noncontrolling interest receives is based on the specific provisions of each operating agreement and varies depending on certain factors including the amount of capital contributed by each investor and whether any investors are entitled to preferential distributions. The amounts in the column labeled "Unconsolidated Properties" were derived on a property-by-property basis by including our share of each line item from each individual entity. This provides visibility into our share of the operations of our joint ventures.

We do not control the unconsolidated joint ventures and the presentations of the assets and liabilities and revenues and expenses do not represent our legal claim to such items. The operating agreements of the unconsolidated joint ventures generally provide that partners may receive cash distributions (1) to the extent there is available cash from operations, (2) upon a capital event, such as a refinancing or sale or (3) upon liquidation of the venture. The amount of cash each partner receives is based upon specific provisions of each operating agreement and varies depending on factors including the amount of capital contributed by each partner and whether any contributions are entitled to priority distributions. Upon liquidation of the joint venture and after all liabilities, priority distributions and initial equity contributions have been repaid, the partners generally would be entitled to any residual cash remaining based on their respective legal ownership percentages.

We provide Non-GAAP proportionate financial information because we believe it assists investors and analysts in estimating our economic interest in our unconsolidated joint ventures when read in conjunction with the Company's reported results under GAAP. Other companies in our industry may calculate their proportionate interest differently than we do, limiting the usefulness as a comparative measure. Because of these limitations, the Non-GAAP proportionate financial information should not be considered in isolation or as a substitute for our financial statements as reported under GAAP.

Net Operating Income (“NOI”), Company NOI and Company Same Store NOI

The Company defines NOI as proportionate income from operations and after operating expenses have been deducted, but prior to deducting financing, property management, administrative and income tax expenses. NOI excludes management fees and other corporate revenue and reductions in ownership as a result of sales or other transactions. The Company considers NOI a helpful supplemental measure of its operating performance because it is a direct measure of the actual results of our properties. Because NOI excludes reductions in ownership as a result of sales or other transactions, management fees and other corporate revenue, general and administrative and property management expenses, interest expense, retail investment property impairment or non-recoverable development costs, depreciation and amortization, gains and losses from property dispositions, allocations to noncontrolling interests, provision for income taxes, preferred stock dividends, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates and operating costs.

The Company also considers Company NOI to be a helpful supplemental measure of its operating performance because it excludes from NOI items such as straight-line rent, and amortization of intangibles resulting from acquisition accounting and other capital contribution or restructuring events. However, due to the exclusions noted, Company NOI should only be used as an alternative measure of the Company’s financial performance.

We present Company NOI, Company EBITDA and Company FFO (as defined below); as we believe certain investors and other users of our financial information use these measures of the Company’s historical operating performance.

Adjustments to NOI, EBITDA and FFO, including debt extinguishment costs, market rate adjustments on debt, straight-line rent, intangible asset and liability amortization, real estate tax stabilization, gains and losses on foreign currency and other items that are not a result of normal operations, assist management and investors in distinguishing whether increases or decreases in revenues and/or expenses are due to growth or decline of operations at the properties or from other factors. In addition, the Company’s leases include step rents that increase over the term of the lease to compensate the Company for anticipated increases in market rentals over time. The Company’s leases do not include significant front loading or back loading of payments or significant rent-free periods. Therefore, we find it useful to evaluate rent on a contractual basis as it allows for comparison of existing rental rates to market rental rates. Management has historically made these adjustments in evaluating our performance, in our annual budget process and for our compensation programs.

The Company defines Company Same Store NOI as Company NOI excluding periodic effects of full or partial acquisitions of properties and certain redevelopments (for the list of properties included in Company Same Store NOI see the Property Schedule in our Supplemental Information). We do not include an acquired property in our Company Same Store NOI until the operating results for that property have been included in our consolidated results for one full calendar year. Properties that we sell are excluded from Company NOI and Company Same Store NOI for all periods once the transaction has closed.

The Company considers Company Same Store NOI a helpful supplemental measure of its operating performance because it assists management and investors in distinguishing whether increases or decreases in revenues and/or expenses are due to growth or decline of operations at comparable properties or from other factors, such as the effect of acquisitions. For these reasons, we believe that Company Same Store NOI, when combined with GAAP operating income provides useful information to investors and management.

Other REITs may use different methodologies for calculating, NOI, Company NOI and Company Same Store NOI, and accordingly, the Company’s Company Same Store NOI may not be comparable to other REITs. As a result of the elimination of corporate-level costs and expenses and depreciation and amortization, the Company Same Store NOI we present does not represent our total revenues, expenses, operating profit or net income and should not be used to evaluate our performance as a whole. Management compensates for these limitations by separately considering the impact of these excluded items, to the extent they are material, to operating decisions or assessments of our operating performance. Our consolidated GAAP statements of operations include such amounts, all of which should be considered by investors when evaluating our performance.

Earnings Before Interest Expense, Income Tax, Depreciation, and Amortization ("EBITDA") and Company EBITDA

The Company defines EBITDA as NOI less certain property management and administrative expenses, net of management fees and other corporate revenues. EBITDA is a commonly used measure of performance in many industries, but may not be comparable to measures calculated by other companies. Management believes EBITDA provides useful information to investors regarding our results of operations because it helps us and our investors evaluate the ongoing operating performance of our properties after removing the impact of our capital structure (primarily interest expense) and our asset base (primarily depreciation and amortization). Management also believes the use of EBITDA facilitates comparisons between us and other equity REITs, retail property owners who are not REITs and other capital-intensive companies. Management uses Company EBITDA to evaluate property-level results and as one measure in determining the value of acquisitions and dispositions and, like FFO and Same Store NOI (discussed below), it is widely used by management in the annual budget process and for compensation programs. Please see adjustments discussion above for the purpose and use of the adjustments included in Company EBITDA.

EBITDA and Company EBITDA, as presented, may not be comparable to similar measures calculated by other companies. This information should not be considered as an alternative to net income, operating profit, cash from operations or any other operating performance measure calculated in accordance with GAAP.

Funds From Operations (“FFO”) and Company FFO

The Company determines FFO based upon the definition set forth by National Association of Real Estate Investment Trusts (“NAREIT”). The Company determines FFO to be its share of consolidated net income (loss) attributable to common shareholders and redeemable non-controlling common unit holders computed in accordance with GAAP, excluding real estate related depreciation and amortization, excluding gains and losses from extraordinary items, excluding cumulative effects of accounting changes, excluding gains and losses from the sales of, or any impairment charges related to, previously depreciated operating properties, plus the allocable portion of FFO of unconsolidated joint ventures based upon the Company’s economic ownership interest, and all determined on a consistent basis in accordance with GAAP. As with the Company’s presentation of NOI, FFO has been reflected on a proportionate basis.

The Company considers FFO a helpful supplemental measure of the operating performance for equity REITs and a complement to GAAP measures because it is a recognized measure of performance by the real estate industry. FFO facilitates an understanding of the operating performance of the Company’s properties between periods because it does not give effect to real estate depreciation and amortization since these amounts are computed to allocate the cost of a property over its useful life. Since values for well-maintained real estate assets have historically increased or decreased based upon prevailing market conditions, the Company believes that FFO provides investors with a clearer view of the Company’s operating performance.

We calculate FFO in accordance with standards established by NAREIT, which may not be comparable to measures calculated by other companies who do not use the NAREIT definition of FFO or do not calculate FFO in accordance with NAREIT guidance. In addition, although FFO is a useful measure when comparing our results to other REITs, it may not be helpful to investors when comparing us to non-REITs. As with the presentation of Company NOI and Company EBITDA, we also consider Company FFO, which is not in accordance with NAREIT guidance and may not be comparable to measures calculated by other REITs, to be a helpful supplemental measure of our operating performance. Please see adjustments discussion above for the purpose and use of the adjustments included in Company FFO.

FFO and Company FFO do not represent cash flow from operations as defined by GAAP, should not be considered as an alternative to net income determined in accordance with GAAP as a measure of operating performance, and is not an alternative to cash flows as a measure of liquidity or indicative of funds available to fund our cash needs. In addition, Company FFO per diluted share does not measure, and should not be used as a measure of, amounts that accrue directly to stockholders’ benefit.

Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures

The Company presents NOI, EBITDA and FFO as they are financial measures widely used in the REIT industry. In order to provide a better understanding of the relationship between the Company’s non-GAAP financial measures of NOI, Company NOI, EBITDA, Company EBITDA, FFO and Company FFO, reconciliations have been provided as follows: a reconciliation of GAAP operating income to Company NOI and Company Same Store NOI, a reconciliation of GAAP net income attributable to GGP to EBITDA and Company EBITDA, and a reconciliation of GAAP net income attributable to GGP to FFO and Company FFO. None of the Company’s non-GAAP financial measures represents cash flow from operating activities in accordance with GAAP, none should be considered as an alternative to GAAP net income (loss) attributable to GGP and none are necessarily indicative of cash flow. In addition, the Company has presented such financial measures on a consolidated and unconsolidated basis (at the Company’s proportionate share) as the Company believes that given the significance of the Company’s operations that are owned through investments accounted for by the equity method of accounting, the detail of the operations of the Company’s unconsolidated properties provides important insights into the income and FFO produced by such investments.

 
GAAP FINANCIAL STATEMENTS
 
Consolidated Balance Sheets
(In thousands)
 
       
June 30, 2017 December 31, 2016
Assets:
Investment in real estate:
Land $ 3,043,007 $ 3,066,019
Buildings and equipment 16,144,950 16,091,582
Less accumulated depreciation (2,930,511 ) (2,737,286 )
Construction in progress   273,008     251,616  
Net property and equipment 16,530,454 16,671,931
Investment in and loans to/from Unconsolidated Real Estate Affiliates   3,866,518     3,868,993  
Net investment in real estate 20,396,972 20,540,924
Cash and cash equivalents 227,626 474,757
Accounts receivable, net 301,515 322,196
Notes receivable, net 609,415 678,496
Deferred expenses, net 269,445 209,852
Prepaid expenses and other assets   472,473     506,521  
Total assets $ 22,277,446   $ 22,732,746  
Liabilities:
Mortgages, notes and loans payable $ 12,496,119 $ 12,430,418
Investment in Unconsolidated Real Estate Affiliates 25,863 39,506
Accounts payable and accrued expenses 591,023 655,362
Dividend payable 201,238 433,961
Deferred tax liabilities 3,664 3,843
Junior Subordinated Notes   206,200     206,200  
Total liabilities   13,524,107     13,769,290  
Redeemable noncontrolling interests:
Preferred 52,485 144,060
Common   197,294     118,667  
Total redeemable noncontrolling interests   249,779     262,727  
Equity:
Preferred stock 242,042 242,042
Stockholders' Equity 8,184,043 8,393,722
Noncontrolling interests in consolidated real estate affiliates 34,175 33,583
Noncontrolling interests related to long-term incentive plan common units   43,300     31,382  
Total equity   8,503,560     8,700,729  
Total liabilities, redeemable noncontrolling interests and equity $ 22,277,446   $ 22,732,746  
 
GAAP FINANCIAL STATEMENTS
 
Consolidated Statements of Income
(In thousands, except per share)
 
  Three Months Ended   Six Months Ended
June 30, 2017   June 30, 2016 June 30, 2017   June 30, 2016
 
Revenues:
Minimum rents $ 349,205 $ 363,412 $ 698,218 $ 734,544
Tenant recoveries 161,926 169,763 324,982 342,211
Overage rents 3,280 4,375 9,217 12,519
Management fees and other corporate revenues 20,847 18,917 48,990 52,659
Other   20,538     18,119     40,722     39,685  
Total revenues   555,796     574,586     1,122,129     1,181,618  
Expenses:
Real estate taxes 59,042 57,309 116,536 115,412
Property maintenance costs 10,724 11,955 25,699 29,438
Marketing 1,296 2,738 3,441 4,792
Other property operating costs 69,590 71,601 138,893 141,995
Provision for doubtful accounts 3,166 1,710 6,617 5,111
Property management and other costs 39,025 38,282 80,139 69,027
Provision for loan loss - - - 36,069
General and administrative 15,862 14,650 30,546 28,076
Provision for impairment - 4,058 - 44,763
Depreciation and amortization   174,298     156,248     344,596     316,919  
Total expenses   373,003     358,551     746,467     791,602  
Operating income   182,793     216,035     375,662     390,016  
Interest and dividend income 17,452 13,335 35,388 29,393
Interest expense (134,209 ) (148,366 ) (266,532 ) (296,043 )
(Loss) gain on foreign currency (3,877 ) 7,893 (694 ) 16,829
(Loss) gain from changes in control of investment properties and other, net (15,841 ) 38,553 (15,841 ) 113,108
Gain on extinguishment of debt   55,112     -     55,112     -  
Income before income taxes, equity in income of Unconsolidated Real Estate Affiliates, and allocation to noncontrolling interests 101,430 127,450 183,095 253,303
(Provision for) benefit from income taxes (3,844 ) 2,242 (8,354 ) (679 )
Equity in income of Unconsolidated Real Estate Affiliates 30,732 34,618 63,946 92,108
Unconsolidated Real Estate Affiliates - gain on investment   -     25,591     -     40,506  
Net income 128,318 189,901 238,687 385,238
Allocation to noncontrolling interests   (2,455 )   (3,956 )   (5,665 )   (7,513 )
Net income attributable to GGP 125,863 185,945 233,022 377,725
Preferred stock dividends   (3,984 )   (3,983 )   (7,968 )   (7,967 )
Net income attributable to common stockholders $ 121,879   $ 181,962   $ 225,054   $ 369,758  
       
Basic earnings per share $ 0.14   $ 0.21   $ 0.25   $ 0.42  
Diluted earnings per share $ 0.13   $ 0.19   $ 0.24   $ 0.39  
 
NON-GAAP PROPORTIONATE FINANCIAL INFORMATION
 
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share)
   
Three Months Ended Six Months Ended
June 30, 2017   June 30, 2016 June 30, 2017   June 30, 2016

Reconciliation of GAAP Operating Income to Company Same Store NOI

   
Operating Income $ 182,793 $ 216,035 $ 375,662 $ 390,016
Loss (gain) on sales of investment properties 83 1 (1,129 ) -
Depreciation and amortization 174,298 156,248 344,596 316,919
Provision for loan loss - - - 36,069
Provision for impairment - 4,058 - 44,763
General and administrative 15,862 14,649 30,546 28,076
Property management and other costs 39,025 38,282 80,139 69,027
Management fees and other corporate revenues   (20,847 )     (18,917 )   (48,990 )     (52,659 )
Consolidated Properties 391,214 410,356 780,824 832,211
Noncontrolling interest in NOI of Consolidated Properties (5,102 ) (3,418 ) (10,822 ) (7,344 )
NOI of sold interests (4,290 ) (24,591 ) (9,140 ) (50,659 )
Unconsolidated Properties   175,836       166,625     361,930       354,237  
Proportionate NOI 557,658 548,972 1,122,792 1,128,445
Company adjustments:
Minimum rents 3,495 3,330 11,678 6,473
Real estate taxes 1,490 1,490 2,979 2,979
Property operating expenses   788       802     1,576       1,604  
Company NOI   563,431       554,594     1,139,025       1,139,501  
Less Company Non-Same Store NOI   16,621       11,497     34,297       52,676  
Company Same Store NOI $ 546,810     $ 543,097   $ 1,104,728     $ 1,086,825  
 

Reconciliation of GAAP Net Income Attributable to GGP to Company EBITDA

Net Income Attributable to GGP $ 125,863 $ 185,945 $ 233,022 $ 377,725
Allocation to noncontrolling interests 2,455 3,956 5,665 7,513
(Loss) gain on sales of investment properties 83 1 (1,129 ) -
Gain on extinguishment of debt (55,112 ) - (55,112 ) -
Loss (gains) from changes in control of investment properties and other 15,841 (38,553 ) 15,841 (113,108 )
Unconsolidated Real Estate Affiliates - gain on investment - (25,591 ) - (40,506 )
Equity in income of Unconsolidated Real Estate Affiliates (30,732 ) (34,618 ) (63,946 ) (92,108 )
Provision for loan loss - - - 36,069
Provision for impairment - 4,058 - 44,763
Provision for income taxes 3,844 (2,242 ) 8,354 679
Loss (gain) on foreign currency 3,877 (7,893 ) 694 (16,829 )
Interest expense 134,209 148,366 266,532 296,043
Interest and dividend income (17,452 ) (13,335 ) (35,388 ) (29,393 )
Depreciation and amortization   174,298       156,248     344,596       316,919  
Consolidated Properties 357,174 376,342 719,129 787,767
Noncontrolling interest in EBITDA of Consolidated Properties (4,904 ) (3,289 ) (10,397 ) (7,064 )
EBITDA of sold interests (4,208 ) (24,328 ) (8,976 ) (50,128 )
Unconsolidated Properties   165,784       157,689     342,405       336,543  
Proportionate EBITDA 513,846 506,414 1,042,161 1,067,118
Company adjustments:
Minimum rents 3,495 3,330 11,678 6,473
Real estate taxes 1,490 1,490 2,979 2,979
Property operating expenses   788       802     1,576       1,604  
Company EBITDA $ 519,619     $ 512,036   $ 1,058,394     $ 1,078,174  
 

Reconciliation of GAAP Net Income Attributable to GGP to Company FFO

Net Income Attributable to GGP $ 125,863 $ 185,945 $ 233,022 $ 377,725
Redeemable noncontrolling interests 975 1,358 1,805 2,883
Provision for impairment excluded from FFO - 4,058 - 44,763
Noncontrolling interests in depreciation of Consolidated Properties (2,008 ) (1,168 ) (4,783 ) (3,283 )
Unconsolidated Real Estate Affiliates - gain on investment - (25,591 ) - (40,506 )
Loss (gain) on sales of investment properties 83 - (1,129 ) 1
Preferred stock dividends (3,984 ) (3,983 ) (7,968 ) (7,967 )
Loss (gains) from changes in control of investment properties and other 15,841 (38,553 ) 15,841 (113,108 )
Depreciation and amortization of capitalized real estate costs - Consolidated Properties 169,867 152,134 335,845 309,696
Depreciation and amortization of capitalized real estate costs - Unconsolidated Properties   74,566       68,038     148,559       135,344  
FFO 381,203 342,238 721,192 705,548
Company adjustments:
Minimum rents 3,495 3,330 11,678 6,473
Property operating expenses 1,490 1,490 2,979 2,979
Property management and other costs 788 802 1,576 1,604
Investment income, net (205 ) (205 ) (409 ) (409 )
Market rate adjustments (1,122 ) (1,453 ) (2,332 ) (2,672 )
Provision for loan loss - - - 28,549
Loss (gain) on foreign currency 3,877 (7,893 ) 694 (16,829 )
Provision (benefit) for income taxes - 724 - (4,355 )
FFO from sold interests   (54,809 )     1,017     (54,444 )     1,965  
Company FFO $ 334,717     $ 340,050   $ 680,934     $ 722,853  
 

Reconciliation of Net Income Attributable to GGP per diluted share to Company FFO per diluted share

Net Income Attributable to GGP per diluted share $ 0.13 $ 0.19 $ 0.24 $ 0.39
Preferred stock dividends   -       -     (0.01 )     (0.01 )
Net income attributable to common stockholders per diluted share 0.13 0.19 0.23 0.38
Provision for impairment excluded from FFO - - - 0.05
Noncontrolling interests in depreciation of Consolidated Properties - - (0.01 ) -
Unconsolidated Real Estate Affiliates - gain on investment - (0.03 ) - (0.04 )
Loss (gains) from changes in control of investment properties and other 0.02 (0.04 ) 0.02 (0.12 )
Depreciation and amortization of capitalized real estate costs   0.25      

0.24

    0.52       0.47  
FFO per diluted share 0.40 0.36 0.76 0.74
Company adjustments:
Straight-line rent - - 0.01 0.01
Loan loss provision - - - 0.03
Gain on foreign currency - (0.01 ) - (0.03 )
FFO from sold interests   (0.05 )     -     (0.06 )     -  
Company FFO per diluted share $ 0.35     $ 0.35   $ 0.71     $ 0.75  
 

Contact:

GGP Inc.
Kevin Berry
SVP Investor and Public Relations
(312) 960-5529
kevin.berry@ggp.com

Investor Relations

If you have questions regarding GGP, please submit your request in writing or by phone to:

Kevin Berry, Senior Vice President of Investor & Public Relations

(312) 960-5529

(312) 960-5529

kevin.berry@ggp.com

 

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