Vornado Announces Fourth Quarter 2009 Financial Results
PARAMUS, N.J.--(BUSINESS WIRE)-- VORNADO REALTY TRUST (NYSE: VNO) today reported:
Fourth Quarter 2009 Results
NET LOSS attributable to common shareholders for the quarter ended December 31, 2009 was $151.2 million, or $0.84 per diluted share, versus $227.0 million, or $1.47 per diluted share, for the quarter ended December 31, 2008. Net loss for the quarters ended December 31, 2009 and 2008 includes $2.6 million and $1.1 million, respectively, of net gains on sale of real estate. In addition, net loss for the quarters ended December 31, 2009 and 2008 includes certain items that affect comparability which are listed in the table below. The aggregate of the net gains on sale of real estate and the items in the table below, net of amounts attributable to noncontrolling interests, increased net loss attributable to common shareholders for the quarter ended December 31, 2009 and December 31, 2008 by $184.3 million and $251.8 million, or $1.03 and $1.63 per diluted share, respectively.
FUNDS FROM OPERATIONS attributable to common shareholders plus assumed conversions ("FFO") for the quarter ended December 31, 2009 was $20 thousand, or $0.00 per diluted share, compared to a negative FFO of $88.2 million, or $0.57 per diluted share, for the quarter ended December 31, 2008. Adjusting FFO for certain items that affect comparability which are listed in the table below, FFO for the quarters ended December 31, 2009 and 2008 was $189.5 million and $165.4 million, or $1.04 and $1.07 per diluted share, respectively.
(Amounts in thousands) For the Quarters
Ended December 31,
2009 2008
FFO (Negative FFO) (1) $ 20 $ (88,154 )
Per Share $ 0.00 $ (0.57 )
Items that affect comparability (income) expense:
Non-cash asset write-downs:
Real estate - development related $ 80,834 $ 71,793
Mezzanine loans loss accrual 68,000 --
Partially owned entities 17,820 162,544
Marketable securities 3,361 55,471
Other real estate assets 6,989 1,645
Net loss (gain) on early extinguishment of debt 52,911 (9,820 )
Income from terminated sale of land (27,089 ) --
Our share of Alexander's reversal of stock -- (14,188 )
appreciation rights compensation expense
Derivative positions in marketable equity securities -- 7,928
Other, net 2,204 8,426
205,030 283,799
Noncontrolling interests' share of above adjustments (15,575 ) (30,293 )
Total items that affect comparability $ 189,455 $ 253,506
Per Share $ 1.04 $ 1.64
FFO as adjusted for comparability $ 189,475 $ 165,352
Per Share $ 1.04 $ 1.07
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(1) See page 4 for a reconciliation of our net income to FFO for the quarters ended December 31, 2009 and 2008.
Year Ended December 31, 2009 Results
NET INCOME attributable to common shareholders for the year ended December 31, 2009 was $49.1 million, or $0.28 per diluted share, versus $302.2 million, or $1.91 per diluted share, for the year ended December 31, 2008. Net income for the years ended December 31, 2009 and 2008 includes $46.6 million, and $67.0 million, respectively, of net gains on sale of real estate. In addition, net income for the years ended December 31, 2009 and 2008 includes certain items that affect comparability which are listed in the table below. The aggregate of the net gains on sale of real estate and the items in the table below, net of amounts attributable to noncontrolling interests, decreased net income attributable to common shareholders for the year ended December 31, 2009 by $241.6 million, or $1.39 per diluted share and increased net income attributable to common shareholders for the year ended December 31, 2008 by $17.6 million, or $0.11 per diluted share.
FFO for the year ended December 31, 2009 was $583.6 million, or $3.36 per diluted share, compared to $813.1 million, or $4.97 per diluted share, for the year ended December 31, 2008. Adjusting FFO for certain items that affect comparability which are listed in the table below, FFO for the years ended December 31, 2009 and 2008 was $868.1 million and $849.3 million, or $5.00 and $5.19 per diluted share, respectively.
(Amounts in thousands) For the Years Ended
December 31,
2009 2008
FFO (1) $ 583,596 $ 813,064
Per Share $ 3.36 $ 4.97
Items that affect comparability (income) expense:
Non-cash asset write-downs:
Mezzanine loans loss accrual (reversal) $ 190,738 $ (10,300 )
Real estate - development related 80,834 76,793
Partially owned entities 36,941 203,919
Marketable securities 3,361 76,352
Other real estate assets 6,989 4,654
Write-off of unamortized costs from the voluntary 32,588 --
surrender of equity awards
Net loss (gain) on early extinguishment of debt 25,915 (9,820 )
Income from forfeited deposit on land sale of H (27,089 ) --
Street
Our share of Toys "R" Us:
Non-cash purchase accounting adjustments (13,946 ) 14,900
Litigation settlement income (10,200 ) --
Our share of Alexander's:
Income tax benefit (13,668 ) --
Reversal of stock appreciation rights compensation (11,105 ) (6,583 )
expense
Downtown Crossing, Boston, lease termination payment 7,650 --
Reversal of deferred taxes initially recorded in -- (222,174 )
connection with H Street acquisition
Net gain on sale of our 47.6% interest in Americold -- (112,690 )
Realty Trust
Derivative positions in marketable equity securities -- 33,740
Americold's FFO - sold in march 2008 -- (6,098 )
Other, net 413 (2,924 )
309,421 39,769
Noncontrolling interests' share of above adjustments (24,882 ) (3,553 )
Total items that affect comparability $ 284,539 $ 36,216
Per Share $ 1.64 $ 0.22
FFO as adjusted for comparability $ 868,135 $ 849,280
Per Share $ 5.00 $ 5.19
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(1) See page 4 for a reconciliation of our net income to FFO for the years ended December 31, 2009 and 2008.
Supplemental Financial Information
Further details regarding financial results, properties and tenants can be accessed at www.vno.com. Vornado Realty Trust is a fully integrated equity real estate investment trust.
Certain statements contained herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. For a discussion of factors that could materially affect the outcome of our forward-looking statements and our future results and financial condition, see "Risk Factors" in Part I, Item 1A, of our Annual Report on Form 10-K for the year ended December 31, 2009. Such factors include, among others, risks associated with the timing of and costs associated with property improvements, financing commitments and general competitive factors.
VORNADO REALTY TRUST
OPERATING RESULTS FOR THE QUARTERS AND YEARS ENDED
DECEMBER 31, 2009 AND 2008
For The Quarters For The Years
Ended December 31, Ended December 31,
(Amounts in thousands,
except per share 2009 2008 2009 2008
amounts)
Revenues $ 719,003 $ 695,153 $ 2,742,578 $ 2,692,686
(Loss) income from $ (146,079 ) $ (228,466 ) $ 76,545 $ 237,832
continuing operations
Income from
discontinued 2,629 799 51,905 173,613
operations
Net (loss) income (143,450 ) (227,667 ) 128,450 411,445
Net loss (income)
attributable to
noncontrolling 6,527 14,987 (22,281 ) (52,148 )
interests, including
unit distributions
Net (loss) income
attributable to (136,923 ) (212,680 ) 106,169 359,297
Vornado
Preferred share (14,269 ) (14,271 ) (57,076 ) (57,091 )
dividends
Net income (loss)
attributable to common $ (151,192 ) $ (226,951 ) $ 49,093 $ 302,206
shareholders
Net (loss) income per
common share:
Basic $ (0.84 ) $ (1.47 ) $ 0.28 $ 1.96
Diluted $ (0.84 ) $ (1.47 ) $ 0.28 $ 1.91
Weighted average
number of common
shares and share
equivalents
outstanding:
Basic 179,832 154,590 171,595 153,900
Diluted 179,832 154,590 173,503 158,119
FFO (Negative FFO)
attributable to common $ 20 $ (88,154 ) $ 583,596 $ 813,064
shareholders plus
assumed conversions
FFO (Negative FFO) per $ 0.00 $ (0.57 ) $ 3.36 $ 4.97
diluted share
Weighted average
number of common
shares and share
equivalents 182,459 154,590 173,578 163,759
outstanding used in
determining FFO per
diluted share
The following table reconciles our net income to FFO:
For The Quarters For The Years
Ended December 31, Ended December 31,
(Amounts in thousands) 2009 2008 2009 2008
Net (loss) income $ (136,923 ) $ (212,680 ) $ 106,169 $ 359,297
attributable to Vornado
Depreciation and
amortization of real 133,023 129,305 508,572 509,367
property
Net gains on sale of real (2,629 ) -- (45,282 ) (57,523 )
estate
Proportionate share of
adjustments to equity in
net income of partially
owned entities, excluding
Toys, to arrive at FFO:
Depreciation and
amortization of real 22,692 13,735 75,200 49,513
property
Net gains on sale of real (3 ) (528 ) (1,188 ) (8,759 )
estate
Proportionate share of
adjustments equity in net
income of Toys to arrive
at FFO:
Depreciation and
amortization of real 15,527 15,533 65,358 66,435
property
Net gains on sale of real -- (555 ) (164 ) (719 )
estate
Income tax effect of above (5,435 ) (5,242 ) (22,819 ) (23,223 )
adjustments
Noncontrolling interests' (11,963 ) (13,451 ) (45,344 ) (49,683 )
share of above adjustments
FFO (Negative FFO) 14,289 (73,883 ) 640,502 844,705
Preferred share dividends (14,269 ) (14,271 ) (57,076 ) (57,091 )
FFO (Negative FFO)
attributable to common 20 (88,154 ) 583,426 787,614
shareholders
Interest on 3.875%
exchangeable senior -- -- -- 25,261
debentures
Convertible preferred -- -- 170 189
share dividends
FFO (Negative FFO)
attributable to common $ 20 $ (88,154 ) $ 583,596 $ 813,064
shareholders plus assumed
conversions
FFO is computed in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"). NAREIT defines FFO as GAAP net income or loss adjusted to exclude net gains from sales of depreciated real estate assets and GAAP extraordinary items, and to include depreciation and amortization expense from real estate assets and other specified non-cash items, including the pro rata share of such adjustments of unconsolidated subsidiaries. FFO and FFO per diluted share are used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. FFO does not represent cash generated from operating activities and is not necessarily indicative of cash available to fund cash requirements and should not be considered as an alternative to net income as a performance measure or cash flows as a liquidity measure. FFO may not be comparable to similarly titled measures employed by other companies. A reconciliation of our net income to FFO is provided above. In addition to FFO, we also disclose FFO before certain items that affect comparability. Although this non-GAAP measure clearly differs from NAREIT's definition of FFO, we believe it provides a meaningful presentation of operating performance. A reconciliation of FFO to FFO as adjusted for comparability is provided on pages 1 and 2 of this press release.
Source: Vornado Realty Trust
Contact: Vornado Realty Trust Joseph Macnow, 201-587-1000