- Earnings Lower Due to Impact of COVID-19 Pandemic
- Amended $1.1 Billion Revolving Line of Credit Facility and Unsecured Term Loans to Provide Financial Flexibility Through the Pandemic
- Starfield Anseong, Taubman Asia’s Fourth Investment, to Open on September 25th nearly 100 Percent Leased
- Asia Sales Rebound Following COVID-19 Closures
BLOOMFIELD HILLS, Mich.--(BUSINESS WIRE)--
Taubman Centers, Inc. (NYSE: TCO) today reported financial results for the second quarter of 2020.
|
June 30, 2020
Three Months Ended
|
June 30, 2019
Three Months Ended
|
June 30, 2020
Six Months Ended
|
June 30, 2019
Six Months Ended
|
Net income (loss) attributable to common shareowners, diluted (in thousands)
|
($34,069)(1)
|
$6,266
|
($14,197)(1)
|
$21,384
|
Net income (loss) attributable to common shareowners (EPS) per diluted common share
|
($0.55)(1)
|
$0.10
|
($0.23)(1)
|
$0.35
|
Funds from Operations (FFO) per diluted common share
|
$0.29
|
$0.78
|
$1.08
|
$1.71
|
Growth rate
|
(62.8)%
|
|
(36.8)%
|
|
Adjusted FFO (AFFO) per diluted common share
|
$0.41(2)
|
$0.94(3)
|
$1.29(2)
|
$1.88(3)
|
Growth rate
|
(56.4)%
|
|
(31.4)%
|
|
(1) Net income (loss) and EPS for the three and six-month periods ended June 30, 2020 were lower primarily due to disruption associated with the COVID-19 pandemic, including significant uncollectible tenant revenues. In addition, depreciation expense was higher due to the accelerated amortization of an allowance in connection with the upcoming closing of an anchor store. EPS for the six-month period ended June 30, 2020 included gains totaling approximately $0.28 per diluted common share related to the sale of 50 percent of our interest in CityOn.Xi’an.
(2) AFFO for the three and six-month periods ended June 30, 2020 excludes costs related to the Simon Property Group, Inc. transaction and the fluctuation in the fair value of equity securities. AFFO for the six-month period ended June 30, 2020 also excludes restructuring charges, deferred income tax expense incurred related to the sale of CityOn.Xi’an, an adjustment of the promote fee (net of tax) related to Starfield Hanam recorded last year and costs associated with the Taubman Asia President transition.
(3) AFFO for the three and six-month periods ended June 30, 2019 excludes restructuring charges, costs incurred related to the Blackstone transactions and costs associated with shareholder activism. AFFO for the six-month period ended June 30, 2019 also excludes the fluctuation in the fair value of equity securities.
|
For the quarter ended June 30, 2020, AFFO per diluted share was $0.41. Disruption related to the COVID-19 pandemic, including widespread center closures for most of the quarter, significantly impacted results.
The company recognized uncollectible tenant revenues of $32.6 million at our beneficial interest, or $0.37 per diluted share of AFFO, in the second quarter, primarily due to elevated tenant bankruptcies and nonpayments during the center closures. These closures negatively impacted sales-based rent and lease cancellation income and resulted in the write-off of straight-line receivables. Together these items reduced AFFO by an additional $0.13 per diluted share. The company’s second quarter 2019 AFFO also included $0.05 per diluted share of insurance proceeds related to the business interruption claim at The Mall of San Juan (San Juan, Puerto Rico).
In aggregate, the above items account for a $0.55 year-over-year variance in second quarter AFFO.
“As we’ve reopened centers, rent collections have steadily improved. We’re optimistic this trend will continue as tenants focus their operations on the best retail assets in each market,” said Robert S. Taubman, chairman, president and chief executive officer of Taubman Centers.
Operating Statistics
Comparable center NOI (comp center NOI) at our beneficial interest, excluding lease cancellation income, was down 25.3 percent in the quarter and down 13.3 percent year-to-date, using constant currency exchange rates. Higher year-over-year uncollectible rental revenues impacted comp center NOI by about 20 percent in the quarter and about 10 percent for the year.
In light of the U.S. center closures, mall tenant sales per square foot, normally a key metric, is not meaningful in the quarter. Trailing 12-month U.S. sales per square foot were $866. In Asia, sales per square foot were up 4.3 percent in the second quarter and were flat year-to-date.
Average rent per square foot for the quarter in U.S. comparable centers was $60.35, down 5.9 percent. Year-to-date average rent per square foot in U.S. comparable centers was $61.14, down 4 percent. Lower sales-based rent, a result of center closures and the overall effects of the pandemic, as well as lower year-over-year rents from Forever 21, collectively impacted average rent per square foot by 4.7 percent in the second quarter and 3.8 percent year-to-date.
Ending occupancy in U.S. comparable centers was 91.5 percent on June 30, 2020, down 0.3 percent compared from June 30, 2019.
Leased space in U.S. comparable centers was 93.8 percent on June 30, 2020, down 1.1 percent from June 30, 2019.
Financing Activity
In late March, the company borrowed $350 million on its $1.1 billion primary revolving line of credit, as a precautionary measure to increase liquidity and financial flexibility due to the uncertainty caused by the COVID-19 pandemic. In late June, the company repaid $100 million, which reduced the outstanding balance on the line of credit to $870 million as of June 30, 2020.
As of June 30, 2020, the company had a consolidated cash balance of $241 million and $119 million available on its lines of credit.
In early August, the company amended its primary $1.1 billion revolving line of credit and unsecured term loan agreements. To ensure appropriate financial flexibility through the pandemic, the amended loan agreement waives compliance with quarterly financial covenants beginning in the third quarter of 2020 through the second quarter of 2021 and replaces them with a minimum liquidity requirement. The company was in full compliance with respect to all covenants as of the second quarter.
Other key features of the amended agreements during the waiver period include:
-
Flexibility to complete planned capital spending, including tenant allowances;
-
Continued ability to distribute taxable income in accordance with our partnership agreement and REIT qualification requirements;
-
Ability to continue dividend payments on Series J Cumulative Preferred Shares (NYSE: TCO PR J) and Series K Cumulative Preferred Shares (NYSE: TCO PR K);
“We’re pleased to have completed this amendment, which provides financial flexibility while our portfolio continues to rebound from the pandemic,” said Simon J. Leopold, executive vice president and chief financial officer. “We greatly appreciate the strong support we have received from our banking partners over the years and particularly during this unprecedented time.”
In August, the company extended the maturity date on the $150 million loan for The Mall at Green Hills (Nashville, Tenn.) for one year to December 1, 2021. On December 1, 2020, the loan will bear interest at a variable rate equal to the greater of LIBOR plus 2.75% or 3.25%.
The construction facilities at Starfield Hanam (Hanam, South Korea) mature in November 2020. The company expects to complete the refinancing at a lower interest rate in the third quarter of 2020. This financing is expected to provide excess proceeds of approximately $35 million at our beneficial interest and combined with the release of additional reserves will allow us to repatriate $58 million at our beneficial interest in the third quarter.
These activities address all the company’s debt maturities occurring in 2020.
Starfield Anseong
On September 25th, Starfield Anseong (Gyeonggi Province, South Korea) will celebrate its grand opening, marking Taubman Asia’s fourth investment and second joint venture with Shinsegae Group. This new one million square foot shopping mall will be the first modern shopping, dining and entertainment destination to serve Anseong, a high-growth city in Greater Seoul.
Starfield Anseong will feature about 280 tenants, including prominent international brands like Zara, Nike, Uniqlo, H&M, Vans, COS, Guess, Adidas, BMW and many others. The center will be anchored by E-Mart Traders, ElectroMart, Toy Kingdom and Hanssem, as well as several successful entertainment concepts, including Aquafield, Sports Monster and Megabox, an upscale cinema.
The center is opening ahead of schedule and in advance of Chuseok, an important shopping period in South Korea. We expect to be over 90 percent occupied and nearly 100 percent leased at opening.
“In our second partnership with Shinsegae we have successfully created an impressive, modern retail and entertainment experience that will serve Anseong’s rapidly growing population,” said Paul Wright, president, Taubman Asia. “We’re delighted with the collection of brands we’ve assembled and the very high-quality nature of the project we’re delivering to this community. It will be a unique experience for our customers to enjoy.”
COVID-19 Update
Most of Taubman’s U.S. operating properties closed on March 19th, in response to the COVID-19 pandemic, and have reopened gradually using enhanced safety protocols designed to ensure the health and safety of both our tenants and the communities we serve. Traffic, tenant sales and rent collections have improved each month as mandates were eased or lifted and in-store shopping has resumed. All centers are fully operating, with the exception of Beverly Center (Los Angeles, Calif.) and Sunvalley Shopping Center (Concord, Calif.), where retail offerings are limited to “curbside pickup” and tenants with exterior access. After an initial reopening, both centers were mandated to close. Excluding those two centers, 90 percent of our U.S. stores have reopened.
The company’s three Asia shopping centers – CityOn.Xi’an (Xi’an, China), CityOn.Zhengzhou (Zhengzhou, Henan, China) and Starfield Hanam (Hanam, South Korea) – have rebounded quickly after experiencing varying levels of disruption. CityOn.Xi’an was closed for about a month and reopened on February 29. CityOn.Zhengzhou was closed for 10 days and reopened on February 27. Starfield Hanam never closed. About 90 percent of tenants had reopened by the end of April. Today nearly all tenants are open following approval for cinemas to reopen in China on July 20th. Total mall tenant sales for the portfolio have recovered, as May and June sales volumes were near 2019 levels.
The company has taken several actions to enhance liquidity due to the disruption caused by the COVID-19 pandemic. U.S. planned capital expenditures for the year have been lowered by $100 million to $110 million, at our beneficial interest, which represents an approximately 50 percent reduction from the original budgeted amount. In Asia, the only material capital spending is related to the completion of Starfield Anseong, which is being funded by a construction loan.
Operating expenses for the year are expected to be reduced by about $10 million, at our beneficial interest. In addition, the company did not declare a second quarter dividend on its common stock, preserving approximately $60 million of additional cash.
These cash preservation initiatives, together with the cash on hand, borrowing capacity under our lines of credit, and proceeds from the Starfield Hanam refinancing are expected to provide sufficient liquidity for the company’s near-term operations.
Investor Conference Call
Due to the pending transaction with Simon Property Group, which is currently the subject of litigation, the company will not host a conference call to review the second quarter 2020 financial results.
About Taubman
Taubman Centers is an S&P MidCap 400 Real Estate Investment Trust engaged in the ownership, management and/or leasing of 26 regional, super-regional and outlet shopping centers in the U.S. and Asia. Taubman’s U.S.-owned properties are the most productive in the publicly held U.S. regional mall industry. Founded in 1950, Taubman is headquartered in Bloomfield Hills, Mich. Taubman Asia, founded in 2005, is headquartered in Hong Kong. www.taubman.com.
For ease of use, references in this press release to “Taubman Centers,”, “we”, “us”, “our”, “company,” “Taubman” or an operating platform mean Taubman Centers, Inc. and/or one or more of a number of separate, affiliated entities. Business is actually conducted by an affiliated entity rather than Taubman Centers, Inc. itself or the named operating platform.
This press release contains certain “forward-looking” statements as that term is defined by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements that are predictive in nature, that depend on or relate to future events or conditions, or that include words such as “believes”, “anticipates”, “expects”, “may”, “will”, “would,” “should”, “estimates”, “could”, “intends”, “plans” or other similar expressions are forward-looking statements.
Forward-looking statements involve significant known and unknown risks and uncertainties that may cause actual results in future periods to differ materially from those projected or contemplated in the forward-looking statements as a result of, but not limited to, the following factors: the COVID-19 pandemic and related challenges, risks and uncertainties which have had, and may continue to have, direct and indirect adverse impacts on the general economy, retail environment, tenants, customers, and employees, as well as center and tenant operations (including the ability to remain open) and operating procedures, occupancy, anchor and mall tenant sales, sales-based rent, rent collection, leasing and negotiated rents, center development and redevelopment activities and the fair value of assets (increasing the likelihood of future impairment charges); future economic performance, including stabilization and recovery from the impact of the COVID-19 pandemic; savings due to cost-cutting measures; payments of dividends and the sufficiency of cash to meet operational needs; changes in market rental rates; unscheduled closings or bankruptcies of tenants; relationships with anchor tenants; trends in the retail industry; challenges with department stores; changes in consumer shopping behavior, including accelerated trends resulting from the COVID-19 pandemic; the liquidity of real estate investments; Taubman’s ability to comply with debt covenants; the availability and terms of financings; changes in market rates of interest and foreign exchange rates for foreign currencies; changes in value of investments in foreign entities; the ability to hedge interest rate and currency risk; risks related to acquiring, developing, expanding, leasing and managing properties; competitors gaining economies of scale through M&A and consolidation activity; changes in value of investments in foreign entities; risks related to joint venture properties; insurance costs and coverage; security breaches that could impact Taubman’s information technology, infrastructure or personal data; costs associated with response to technology breaches; the loss of key management personnel; shareholder activism costs and related diversion of management time; terrorist activities; maintaining Taubman’s status as a real estate investment trust; changes in the laws of states, localities, and foreign jurisdictions that may increase taxes on the company’s operations; changes in global, national, regional and/or local economic and geopolitical climates; the outcome of any litigation between Taubman and Simon Property Group, Inc. (“Simon”) related to the proposed transactions between Taubman and Simon, including the litigation in the State of Michigan Circuit Court for the Sixth Judicial Circuit (Oakland County); the outcome of any shareholder litigation related to the proposed transactions, and insurance coverage for liabilities of Taubman or its directors, if any, thereunder; the inability to complete the proposed transactions due to the failure to satisfy any conditions to completion of the proposed transactions; the risk that a condition to closing of the transaction may not be satisfied; Simon’s and Taubman’s ability to consummate the transaction; the possibility that the anticipated benefits from the transaction will not be fully realized; the ability of Taubman to retain key personnel and maintain relationships with business partners pending the consummation of the transaction; and the impact of legislative, regulatory and competitive changes and other risk factors relating to the industry in which Taubman operates, as detailed from time to time in Taubman’s reports filed with the SEC. There can be no assurance that the transaction will in fact be consummated.
Additional information about these factors and about the material factors or assumptions underlying such forward-looking statements may be found under Item 1.A in Taubman’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, as amended, and subsequent reports filed with the Securities and Exchange Commission. Taubman cautions that the foregoing list of important factors that may affect future results is not exhaustive. When relying on forward-looking statements to make decisions with respect to the proposed transaction, shareholders and others should carefully consider the foregoing factors and other uncertainties and potential events. All subsequent written and oral forward-looking statements concerning the proposed transaction or other matters attributable to Taubman or any other person acting on their behalf are expressly qualified in their entirety by the cautionary statements referenced above. The forward-looking statements contained herein speak only as of the date of this communication or the date otherwise specified herein. Taubman does not undertake any obligation to update or revise any forward-looking statements for any reason, even if new information becomes available or other events occur in the future, except as may be required by law.
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
Table 1 - Summary of Results
|
|
|
|
|
|
|
|
|
For the Periods Ended June 30, 2020 and 2019
|
|
|
|
|
|
|
|
|
(in thousands of dollars, except as indicated)
|
|
Three Months Ended
|
|
Year to Date
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Net income (loss)
|
|
(41,795
|
)
|
|
16,877
|
|
|
(5,311
|
)
|
|
46,615
|
|
Noncontrolling share of income of consolidated joint ventures
|
|
(300
|
)
|
|
(832
|
)
|
|
(1,323
|
)
|
|
(2,261
|
)
|
Noncontrolling share of (income) loss of TRG
|
|
13,811
|
|
|
(3,408
|
)
|
|
4,601
|
|
|
(10,209
|
)
|
Distributions to participating securities of TRG
|
|
|
|
(593
|
)
|
|
(595
|
)
|
|
(1,220
|
)
|
Preferred stock dividends
|
|
(5,785
|
)
|
|
(5,785
|
)
|
|
(11,569
|
)
|
|
(11,569
|
)
|
Net income (loss) attributable to Taubman Centers, Inc. common shareowners
|
|
(34,069
|
)
|
|
6,259
|
|
|
(14,197
|
)
|
|
21,356
|
|
Net income (loss) per common share - basic
|
|
(0.55
|
)
|
|
0.10
|
|
|
(0.23
|
)
|
|
0.35
|
|
Net income (loss) per common share - diluted
|
|
(0.55
|
)
|
|
0.10
|
|
|
(0.23
|
)
|
|
0.35
|
|
Funds from Operations attributable to partnership unitholders and participating securities of TRG (1)
|
|
25,963
|
|
|
68,790
|
|
|
95,921
|
|
|
150,083
|
|
Funds from Operations attributable to TCO's common shareowners (1)
|
|
18,213
|
|
|
48,018
|
|
|
67,090
|
|
|
105,797
|
|
Funds from Operations per common share - basic (1)
|
|
0.30
|
|
|
0.78
|
|
|
1.09
|
|
|
1.73
|
|
Funds from Operations per common share - diluted (1)
|
|
0.29
|
|
|
0.78
|
|
|
1.08
|
|
|
1.71
|
|
Adjusted Funds from Operations attributable to partnership unitholders and participating securities of TRG (1)
|
|
36,558
|
|
|
82,940
|
|
|
114,902
|
|
|
165,512
|
|
Adjusted Funds from Operations attributable to TCO's common shareowners (1)
|
|
25,653
|
|
|
57,896
|
|
|
80,389
|
|
|
116,584
|
|
Adjusted Funds from Operations per common share - basic (1)
|
|
0.42
|
|
|
0.95
|
|
|
1.31
|
|
|
1.91
|
|
Adjusted Funds from Operations per common share - diluted (1)
|
|
0.41
|
|
|
0.94
|
|
|
1.29
|
|
|
1.88
|
|
Weighted average number of common shares outstanding - basic
|
|
61,590,226
|
|
|
61,171,614
|
|
|
61,419,931
|
|
|
61,147,947
|
|
Weighted average number of common shares outstanding - diluted
|
|
61,590,226
|
|
|
61,339,925
|
|
|
61,419,931
|
|
|
61,354,428
|
|
Common shares outstanding at end of period
|
|
61,615,362
|
|
|
61,208,580
|
|
|
|
|
|
Weighted average units - Operating Partnership - basic
|
|
87,707,362
|
|
|
87,633,194
|
|
|
87,687,555
|
|
|
86,820,900
|
|
Weighted average units - Operating Partnership - diluted
|
|
88,783,724
|
|
|
88,672,767
|
|
|
88,773,594
|
|
|
87,898,643
|
|
Units outstanding at end of period - Operating Partnership
|
|
87,712,025
|
|
|
87,639,296
|
|
|
|
|
|
Ownership percentage of the Operating Partnership at end of period
|
|
70.2
|
%
|
|
69.8
|
%
|
|
70.0
|
%
|
|
70.4
|
%
|
Number of owned shopping centers at end of period
|
|
24
|
|
|
24
|
|
|
|
|
|
Operating Statistics:
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers - growth % (1)(2)
|
|
(24.0
|
)%
|
|
2.4
|
%
|
|
(13.2
|
)%
|
|
(0.7
|
)%
|
NOI at 100% - comparable centers including lease cancellation income at constant
currency - growth % (1)
|
|
(23.4
|
)%
|
|
|
|
(12.6
|
)%
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income - growth % (1)(2)
|
|
(24.7
|
)%
|
|
0.3
|
%
|
|
(13.8
|
)%
|
|
1.3
|
%
|
NOI at 100% - comparable centers excluding lease cancellation income at constant
currency - growth % (1)(2)
|
|
(24.1
|
)%
|
|
1.4
|
%
|
|
(13.2
|
)%
|
|
2.2
|
%
|
Beneficial interest in NOI - comparable centers including lease cancellation income - growth % (1)
|
|
(24.8
|
)%
|
|
|
|
(12.7
|
)%
|
|
|
Beneficial interest in NOI - comparable centers including lease cancellation income
at constant currency - growth % (1)
|
|
(24.6
|
)%
|
|
|
|
(12.5
|
)%
|
|
|
Beneficial interest in NOI - comparable centers excluding lease cancellation income - growth % (1)
|
|
(25.5
|
)%
|
|
|
|
(13.4
|
)%
|
|
|
Beneficial interest in NOI - comparable centers excluding lease cancellation income
at constant currency - growth % (1)
|
|
(25.3
|
)%
|
|
|
|
(13.3
|
)%
|
|
|
Beneficial interest in NOI - total portfolio excluding lease cancellation income - growth % (1)(2)
|
|
(30.8
|
)%
|
|
4.6
|
%
|
|
(17.2
|
)%
|
|
5.1
|
%
|
Average rent per square foot - U.S. Consolidated Businesses (3)
|
|
69.77
|
|
|
71.75
|
|
|
70.03
|
|
|
71.31
|
|
Average rent per square foot - U.S. UJVs (3)
|
|
50.75
|
|
|
56.41
|
|
|
52.08
|
|
|
55.97
|
|
Average rent per square foot - Combined U.S. centers (3)
|
|
60.35
|
|
|
64.13
|
|
|
61.14
|
|
|
63.67
|
|
Average rent per square foot growth % - U.S. comparable centers (3)
|
|
(5.9
|
)%
|
|
|
|
(4.0
|
)%
|
|
|
Ending occupancy - all U.S. centers
|
|
89.8
|
%
|
|
91.0
|
%
|
|
|
|
|
Ending occupancy - U.S. comparable centers (3)
|
|
91.5
|
%
|
|
91.8
|
%
|
|
|
|
|
Leased space - all U.S. centers
|
|
91.9
|
%
|
|
94.0
|
%
|
|
|
|
|
Leased space - U.S. comparable centers (3)
|
|
93.8
|
%
|
|
94.9
|
%
|
|
|
|
|
Mall tenant sales - all U.S. centers (4)
|
|
415,944
|
|
|
1,574,512
|
|
|
1,751,227
|
|
|
3,205,891
|
|
Mall tenant sales - U.S. comparable centers (3)(4)
|
|
357,246
|
|
|
1,374,140
|
|
|
1,530,574
|
|
|
2,887,608
|
|
|
|
|
|
|
|
12-Months Trailing
|
Operating Statistics:
|
|
|
|
|
|
2020
|
|
2019
|
Mall tenant sales - all U.S. centers (4)
|
|
|
|
|
|
5,460,510
|
|
|
6,519,819
|
|
Mall tenant sales - U.S. comparable centers (3)(4)
|
|
|
|
|
|
4,773,841
|
|
|
5,914,845
|
|
Sales per square foot - U.S. comparable centers (3)(4)
|
|
|
|
|
|
866
|
|
|
956
|
|
All U.S. centers (4):
|
|
|
|
|
|
|
|
|
Mall tenant occupancy costs as a percentage of tenant sales - U.S. Consolidated Businesses
|
|
|
|
|
|
17.2
|
%
|
|
13.5
|
%
|
Mall tenant occupancy costs as a percentage of tenant sales - U.S. UJVs
|
|
|
|
|
|
14.0
|
%
|
|
11.9
|
%
|
Mall tenant occupancy costs as a percentage of tenant sales - Combined U.S. centers
|
|
|
|
|
|
15.7
|
%
|
|
12.7
|
%
|
U.S. comparable centers (3)(4):
|
|
|
|
|
|
|
|
|
Mall tenant occupancy costs as a percentage of tenant sales - U.S. Consolidated Businesses
|
|
|
|
|
|
16.7
|
%
|
|
13.1
|
%
|
Mall tenant occupancy costs as a percentage of tenant sales - U.S. UJVs
|
|
|
|
|
|
13.9
|
%
|
|
11.8
|
%
|
Mall tenant occupancy costs as a percentage of tenant sales - Combined U.S. centers
|
|
|
|
|
|
15.4
|
%
|
|
12.5
|
%
|
(1)
|
|
See 'Use of Non-GAAP Financial Measures' for the definition and use of EBITDA, NOI, and FFO.
|
(2)
|
|
Statistics exclude non-comparable centers as defined in the respective periods and have not been subsequently restated for changes in the pools of comparable centers.
|
(3)
|
|
Statistics exclude non-comparable centers for all periods presented. The June 30, 2019 statistics have been restated to include comparable centers to 2020.
|
(4)
|
|
Based on reports of sales furnished by mall tenants. Sales per square foot exclude spaces greater than or equal to 10,000 square feet.
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
Table 2 - Income Statement
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, 2020 and 2019
|
|
|
|
|
|
|
|
|
(in thousands of dollars)
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
|
CONSOLIDATED
|
|
UNCONSOLIDATED
|
|
CONSOLIDATED
|
|
UNCONSOLIDATED
|
|
|
BUSINESSES
|
|
JOINT VENTURES (1)
|
|
BUSINESSES
|
|
JOINT VENTURES (1)
|
REVENUES:
|
|
|
|
|
|
|
|
|
Rental revenues
|
|
112,218
|
|
|
110,596
|
|
|
147,006
|
|
|
142,097
|
|
Overage rents
|
|
749
|
|
|
3,120
|
|
|
1,713
|
|
|
5,164
|
|
Management, leasing, and development services
|
|
824
|
|
|
|
|
892
|
|
|
|
Other
|
|
4,744
|
|
|
6,234
|
|
|
11,993
|
|
|
6,660
|
|
Total revenues
|
|
118,535
|
|
|
119,950
|
|
|
161,604
|
|
|
153,921
|
|
|
|
|
|
|
|
|
|
|
EXPENSES:
|
|
|
|
|
|
|
|
|
Maintenance, taxes, utilities, and promotion
|
|
34,511
|
|
|
44,133
|
|
|
39,182
|
|
|
46,179
|
|
Other operating
|
|
12,792
|
|
|
5,800
|
|
|
21,232
|
|
|
6,853
|
|
Management, leasing, and development services
|
|
659
|
|
|
|
|
491
|
|
|
|
General and administrative
|
|
7,523
|
|
|
|
|
8,554
|
|
|
|
Restructuring charges
|
|
|
|
|
|
84
|
|
|
|
Simon Property Group, Inc. transaction costs
|
|
9,060
|
|
|
|
|
|
|
|
Costs associated with shareholder activism
|
|
|
|
|
|
12,000
|
|
|
|
Interest expense
|
|
33,353
|
|
|
34,517
|
|
|
38,010
|
|
|
35,685
|
|
Depreciation and amortization
|
|
61,838
|
|
|
33,601
|
|
|
44,259
|
|
|
35,622
|
|
Total expenses
|
|
159,736
|
|
|
118,051
|
|
|
163,812
|
|
|
124,339
|
|
|
|
|
|
|
|
|
|
|
Nonoperating income (expense)
|
|
(910
|
)
|
|
487
|
|
|
6,627
|
|
|
923
|
|
|
|
(42,111
|
)
|
|
2,386
|
|
|
4,419
|
|
|
30,505
|
|
Income tax benefit (expense)
|
|
248
|
|
|
(1,289
|
)
|
|
(2,364
|
)
|
|
(2,461
|
)
|
Equity in income (loss) of UJVs
|
|
(712
|
)
|
|
|
|
14,822
|
|
|
|
Gains on partial dispositions of ownership interests in UJVs, net of tax
|
|
363
|
|
|
|
|
|
|
|
Gains on remeasurements of ownership interests in UJVs
|
|
417
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
(41,795
|
)
|
|
1,097
|
|
|
16,877
|
|
|
28,044
|
|
Net income/loss attributable to noncontrolling interests:
|
|
|
|
|
|
|
|
|
Noncontrolling share of income of consolidated joint ventures
|
|
(300
|
)
|
|
|
|
(832
|
)
|
|
|
Noncontrolling share of (income) loss of TRG
|
|
13,811
|
|
|
|
|
(3,408
|
)
|
|
|
Distributions to participating securities of TRG
|
|
|
|
|
|
(593
|
)
|
|
|
Preferred stock dividends
|
|
(5,785
|
)
|
|
|
|
(5,785
|
)
|
|
|
Net income (loss) attributable to Taubman Centers, Inc. common shareholders
|
|
(34,069
|
)
|
|
|
|
6,259
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION:
|
|
|
|
|
|
|
|
|
EBITDA - 100%
|
|
53,860
|
|
|
70,504
|
|
|
86,688
|
|
|
101,812
|
|
EBITDA - outside partners' share
|
|
(4,931
|
)
|
|
(39,531
|
)
|
|
(6,113
|
)
|
|
(49,119
|
)
|
Beneficial interest in EBITDA
|
|
48,929
|
|
|
30,973
|
|
|
80,575
|
|
|
52,693
|
|
Gain on insurance recoveries - The Mall of San Juan
|
|
|
|
|
|
(1,418
|
)
|
|
|
Gains on partial dispositions of ownership interests in UJVs
|
|
(363
|
)
|
|
|
|
|
|
|
Gains on remeasurements of ownership interests in UJVs
|
|
(417
|
)
|
|
|
|
|
|
|
Beneficial interest expense
|
|
(30,605
|
)
|
|
(15,945
|
)
|
|
(34,981
|
)
|
|
(18,005
|
)
|
Beneficial income tax benefit (expense) - TRG and TCO
|
|
248
|
|
|
(104
|
)
|
|
(2,225
|
)
|
|
(912
|
)
|
Beneficial income tax expense - TCO
|
|
19
|
|
|
|
|
|
|
|
Non-real estate depreciation
|
|
(987
|
)
|
|
|
|
(1,152
|
)
|
|
|
Preferred dividends and distributions
|
|
(5,785
|
)
|
|
|
|
(5,785
|
)
|
|
|
Funds from Operations attributable to partnership unitholders and participating securities of TRG
|
|
11,039
|
|
|
14,924
|
|
|
35,014
|
|
|
33,776
|
|
|
|
|
|
|
|
|
|
|
STRAIGHTLINE AND PURCHASE ACCOUNTING ADJUSTMENTS:
|
|
|
|
|
|
|
|
Net straight-line adjustments to rental revenues, recoveries, and ground rent expense at TRG%
|
|
(3,668
|
)
|
|
(441
|
)
|
|
917
|
|
|
437
|
|
Country Club Plaza purchase accounting adjustments - rental revenues at TRG%
|
|
|
|
32
|
|
|
|
|
84
|
|
The Mall at Green Hills purchase accounting adjustments - rental revenues
|
|
8
|
|
|
|
|
13
|
|
|
|
The Gardens Mall purchase accounting adjustments - rental revenues at TRG%
|
|
|
|
(355
|
)
|
|
|
|
(177
|
)
|
The Gardens Mall purchase accounting adjustments - interest expense at TRG%
|
|
|
|
(528
|
)
|
|
|
|
(528
|
)
|
(1)
|
|
With the exception of the Supplemental Information, amounts include 100% of the UJVs. Amounts are net of intercompany transactions. The UJVs are presented at 100% in order to allow for measurement of their performance as a whole, without regard to our ownership interest.
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
Table 3 - Income Statement
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2020 and 2019
|
|
|
|
|
|
|
|
|
(in thousands of dollars)
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
|
CONSOLIDATED
|
|
UNCONSOLIDATED
|
|
CONSOLIDATED
|
|
UNCONSOLIDATED
|
|
|
BUSINESSES
|
|
JOINT VENTURES (1)
|
|
BUSINESSES
|
|
JOINT VENTURES (1)
|
REVENUES:
|
|
|
|
|
|
|
|
|
Rental revenues
|
|
254,876
|
|
|
245,538
|
|
|
291,295
|
|
|
271,653
|
|
Overage rents
|
|
4,966
|
|
|
8,746
|
|
|
4,854
|
|
|
11,543
|
|
Management, leasing, and development services
|
|
1,390
|
|
|
|
|
2,108
|
|
|
|
Other
|
|
16,762
|
|
|
13,363
|
|
|
23,555
|
|
|
13,366
|
|
Total revenues
|
|
277,994
|
|
|
267,647
|
|
|
321,812
|
|
|
296,562
|
|
|
|
|
|
|
|
|
|
|
EXPENSES:
|
|
|
|
|
|
|
|
|
Maintenance, taxes, utilities, and promotion
|
|
73,262
|
|
|
88,966
|
|
|
77,720
|
|
|
87,139
|
|
Other operating
|
|
30,934
|
|
|
13,301
|
|
|
40,457
|
|
|
12,374
|
|
Management, leasing, and development services
|
|
1,152
|
|
|
|
|
1,022
|
|
|
|
General and administrative
|
|
15,539
|
|
|
|
|
17,130
|
|
|
|
Restructuring charges
|
|
362
|
|
|
|
|
709
|
|
|
|
Simon Property Group, Inc. transaction costs
|
|
15,445
|
|
|
|
|
|
|
|
Costs associated with shareholder activism
|
|
|
|
|
|
16,000
|
|
|
|
Interest expense
|
|
68,202
|
|
|
69,174
|
|
|
74,895
|
|
|
68,183
|
|
Depreciation and amortization
|
|
113,534
|
|
|
67,863
|
|
|
89,215
|
|
|
69,312
|
|
Total expenses
|
|
318,430
|
|
|
239,304
|
|
|
317,148
|
|
|
237,008
|
|
|
|
|
|
|
|
|
|
|
Nonoperating income (expense)
|
|
(362
|
)
|
|
824
|
|
|
15,360
|
|
|
1,324
|
|
|
|
(40,798
|
)
|
|
29,167
|
|
|
20,024
|
|
|
60,878
|
|
Income tax expense
|
|
(508
|
)
|
|
(3,228
|
)
|
|
(2,903
|
)
|
|
(4,369
|
)
|
Equity in income of UJVs
|
|
10,572
|
|
|
|
|
29,494
|
|
|
|
Gains on partial dispositions of ownership interests in UJVs, net of tax
|
|
11,277
|
|
|
|
|
|
|
|
Gains on remeasurements of ownership interests in UJVs
|
|
14,146
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
(5,311
|
)
|
|
25,939
|
|
|
46,615
|
|
|
56,509
|
|
Net income/loss attributable to noncontrolling interests:
|
|
|
|
|
|
|
|
|
Noncontrolling share of income of consolidated joint ventures
|
|
(1,323
|
)
|
|
|
|
(2,261
|
)
|
|
|
Noncontrolling share of (income) loss of TRG
|
|
4,601
|
|
|
|
|
(10,209
|
)
|
|
|
Distributions to participating securities of TRG
|
|
(595
|
)
|
|
|
|
(1,220
|
)
|
|
|
Preferred stock dividends
|
|
(11,569
|
)
|
|
|
|
(11,569
|
)
|
|
|
Net income (loss) attributable to Taubman Centers, Inc. common shareholders
|
|
(14,197
|
)
|
|
|
|
21,356
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION:
|
|
|
|
|
|
|
|
|
EBITDA - 100%
|
|
167,843
|
|
|
166,204
|
|
|
184,134
|
|
|
198,373
|
|
EBITDA - outside partners' share
|
|
(10,722
|
)
|
|
(90,810
|
)
|
|
(12,852
|
)
|
|
(96,263
|
)
|
Beneficial interest in EBITDA
|
|
157,121
|
|
|
75,394
|
|
|
171,282
|
|
|
102,110
|
|
Gain on insurance recoveries - The Mall of San Juan
|
|
|
|
|
|
(1,418
|
)
|
|
|
Gains on partial dispositions of ownership interests in UJVs
|
|
(12,759
|
)
|
|
|
|
|
|
|
Gains on remeasurements of ownership interests in UJVs
|
|
(14,146
|
)
|
|
|
|
|
|
|
Beneficial interest expense
|
|
(62,658
|
)
|
|
(32,360
|
)
|
|
(68,841
|
)
|
|
(34,781
|
)
|
Beneficial income tax expense - TRG and TCO
|
|
(508
|
)
|
|
(429
|
)
|
|
(2,714
|
)
|
|
(1,689
|
)
|
Beneficial income tax expense - TCO
|
|
19
|
|
|
|
|
|
|
|
Non-real estate depreciation
|
|
(2,184
|
)
|
|
|
|
(2,297
|
)
|
|
|
Preferred dividends and distributions
|
|
(11,569
|
)
|
|
|
|
(11,569
|
)
|
|
|
Funds from Operations attributable to partnership unitholders and participating securities of TRG
|
|
53,316
|
|
|
42,605
|
|
|
84,443
|
|
|
65,640
|
|
|
|
|
|
|
|
|
|
|
STRAIGHTLINE AND PURCHASE ACCOUNTING ADJUSTMENTS:
|
|
|
|
|
|
|
|
Net straight-line adjustments to rental revenues, recoveries, and ground rent expense at TRG%
|
|
(2,928
|
)
|
|
(554
|
)
|
|
2,715
|
|
|
603
|
|
Country Club Plaza purchase accounting adjustments - rental revenues at TRG%
|
|
|
|
111
|
|
|
|
|
196
|
|
The Mall at Green Hills purchase accounting adjustments - rental revenues
|
|
19
|
|
|
|
|
48
|
|
|
|
The Gardens Mall purchase accounting adjustments - rental revenues at TRG%
|
|
|
|
(641
|
)
|
|
|
|
(177
|
)
|
The Gardens Mall purchase accounting adjustments - interest expense at TRG%
|
|
|
|
(1,056
|
)
|
|
|
|
(528
|
)
|
(1)
|
|
With the exception of the Supplemental Information, amounts include 100% of the UJVs. Amounts are net of intercompany transactions. The UJVs are presented at 100% in order to allow for measurement of their performance as a whole, without regard to our ownership interest.
|
TAUBMAN CENTERS, INC.
Use of Non-GAAP Financial Measures
In this press release, the terms "we", "us", and "our" refer to Taubman Centers, Inc. (TCO), The Taubman Realty Group Limited Partnership (TRG), and/or TRG's subsidiaries as the context may require.
We use certain non-GAAP operating measures, including EBITDA, beneficial interest in EBITDA, Net Operating Income (NOI), beneficial interest in NOI, and Funds from Operations (FFO). These measures are reconciled to the most comparable GAAP measures. Additional information as to the use of these measures are as follows.
EBITDA represents earnings (loss) before interest, income taxes, and depreciation and amortization of our consolidated and unconsolidated businesses. Beneficial interest in EBITDA represents our share of the earnings (loss) before interest, income taxes, and depreciation and amortization of our consolidated and unconsolidated businesses. We believe EBITDA and beneficial interest in EBITDA provide useful indicators of operating performance, as it is customary in the real estate and shopping center business to evaluate the performance of properties on a basis unaffected by capital structure.
We use NOI as an alternative measure to evaluate the operating performance of centers, both on individual and stabilized portfolio bases, and in formulating corporate goals and compensation. We define NOI as property-level operating revenues (includes rental income excluding straight-line adjustments of minimum rent) less maintenance, property taxes, utilities, promotion, ground rent (including straight-line adjustments), and other property operating expenses. Beneficial interest in NOI represents our share of NOI (as previously defined) of our consolidated and unconsolidated businesses. Since NOI excludes general and administrative expenses, pre-development charges, interest income and expense, depreciation and amortization, impairment charges, restructuring charges, and gains from peripheral land and property dispositions, it provides a performance measure that, when compared period over period, reflects the revenues and expenses most directly associated with owning and operating rental properties, as well as the impact on their operations from trends in tenant sales, occupancy and rental rates, and operating costs. We also use NOI excluding lease cancellation income as an alternative measure because this income may vary significantly from period to period, which can affect comparability and trend analysis. We generally provide separate projections for expected comparable center NOI growth and lease cancellation income. Comparable centers are generally defined as centers that were owned and open for the entire current and preceding period presented, excluding centers impacted by significant redevelopment activity. In addition, The Mall of San Juan has been excluded from comparable center statistics as a result of Hurricane Maria given that the center's performance has been and is expected to continue to be materially impacted for the foreseeable future. Stamford Town Center has also been excluded from comparable center statistics as the center is currently being marketed for sale. We also use NOI excluding lease cancellation income using constant currency exchange rates as an alternative measure because exchange rates may vary significantly from period to period, which can affect comparability and trend analysis.
The National Association of Real Estate Investment Trusts (NAREIT) defines FFO as net income (loss) (calculated in accordance with Generally Accepted Accounting Principles (GAAP)), excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. We believe that FFO is a useful supplemental measure of operating performance for REITs. 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, we and most industry investors and analysts have considered presentations of operating results that exclude historical cost depreciation to be useful in evaluating the operating performance of REITs. We primarily use FFO in measuring performance and in formulating corporate goals and compensation.
We may also present adjusted versions of NOI, beneficial interest in EBITDA, and FFO when used by management to evaluate operating performance when certain significant items have impacted results that affect comparability with prior or future periods due to the nature or amounts of these items. We believe the disclosure of the adjusted items is similarly useful to investors and others to understand management's view on comparability of such measures between periods. The following table summarizes adjustments to FFO and EBITDA for the three and six months ended June 30, 2020 and 2019:
|
|
FFO
|
|
EBITDA
|
|
|
Three Months
Ended
|
|
Year to Date
|
|
Three Months
Ended
|
|
Year to Date
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Simon Property Group, Inc. transaction costs
|
|
•
|
|
|
|
•
|
|
|
|
•
|
|
|
|
•
|
|
|
Costs associated with shareholder activism
|
|
|
|
•
|
|
|
|
•
|
|
|
|
•
|
|
|
|
•
|
Restructuring charges
|
|
|
|
•
|
|
•
|
|
•
|
|
|
|
•
|
|
•
|
|
•
|
Costs related to Blackstone transactions
|
|
|
|
•
|
|
•
|
|
•
|
|
|
|
•
|
|
|
|
•
|
Taubman Asia President transition costs
|
|
|
|
|
|
•
|
|
|
|
|
|
|
|
•
|
|
|
Promote fee adjustment - Starfield Hanam
|
|
|
|
|
|
•
|
|
|
|
|
|
|
|
•
|
|
|
Fluctuation in fair value of equity securities
|
|
•
|
|
|
|
•
|
|
•
|
|
•
|
|
|
|
•
|
|
•
|
Gains on partial dispositions of ownership interests in UJVs
|
|
|
|
|
|
|
|
|
|
•
|
|
|
|
•
|
|
|
Gains on remeasurements of ownership interests in UJVs
|
|
|
|
|
|
|
|
|
|
•
|
|
|
|
•
|
|
|
Gain on insurance recoveries - The Mall of San Juan
|
|
|
|
|
|
|
|
|
|
|
|
•
|
|
|
|
•
|
These non-GAAP measures as presented by us are not necessarily comparable to similarly titled measures used by other REITs due to the fact that not all REITs use the same definitions. These measures should not be considered alternatives to net income (loss) or as an indicator of our operating performance. Additionally, these measures do not represent cash flows from operating, investing, or financing activities as defined by GAAP.
We also provide our beneficial interest in certain financial information of our UJVs. This beneficial information is derived as our ownership interest in the investee multiplied by the specific financial statement item being presented. Investors are cautioned that deriving our beneficial interest in this manner may not accurately depict the legal and economic implications of holding a noncontrolling interest in the investee.
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 4 - Reconciliation of Net Income (Loss) Attributable to Taubman Centers, Inc. Common Shareholders to Funds From Operations and Adjusted Funds From Operations
|
For the Three Months Ended June 30, 2020 and 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands of dollars except as noted; may not add or recalculate due to rounding)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
|
|
|
Shares
|
|
Per Share
|
|
|
|
Shares
|
|
Per Share
|
|
|
Dollars
|
|
/Units
|
|
/Unit
|
|
Dollars
|
|
/Units
|
|
/Unit
|
Net income (loss) attributable to TCO common shareholders - basic
|
|
(34,069
|
)
|
|
61,590,226
|
|
|
(0.55
|
)
|
|
6,259
|
|
|
61,171,614
|
|
|
0.10
|
|
Add impact of share-based compensation
|
|
|
|
|
|
|
|
7
|
|
|
168,311
|
|
|
|
Net income (loss) attributable to TCO common shareholders - diluted
|
|
(34,069
|
)
|
|
61,590,226
|
|
|
(0.55
|
)
|
|
6,266
|
|
|
61,339,925
|
|
|
0.10
|
|
Add TCO's additional income tax expense
|
|
19
|
|
|
|
|
—
|
|
|
|
|
|
|
|
Add depreciation of TCO's additional basis
|
|
1,481
|
|
|
|
|
0.02
|
|
|
1,617
|
|
|
|
|
0.03
|
|
Net income (loss) attributable to TCO common shareholders,
excluding step-up depreciation and additional income tax expense
|
|
(32,569
|
)
|
|
61,590,226
|
|
|
(0.53
|
)
|
|
7,883
|
|
|
61,339,925
|
|
|
0.13
|
|
Add noncontrolling share of income (loss) of TRG
|
|
(13,811
|
)
|
|
26,322,236
|
|
|
|
|
3,408
|
|
|
26,461,580
|
|
|
|
Add distributions to participating securities of TRG
|
|
|
|
871,262
|
|
|
|
|
593
|
|
|
871,262
|
|
|
|
Net income (loss) attributable to partnership unitholders and
participating securities of TRG
|
|
(46,380
|
)
|
|
88,783,724
|
|
|
(0.52
|
)
|
|
11,884
|
|
|
88,672,767
|
|
|
0.13
|
|
Add (less) depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
61,838
|
|
|
|
|
0.70
|
|
|
44,259
|
|
|
|
|
0.50
|
|
Depreciation of TCO's additional basis
|
|
(1,481
|
)
|
|
|
|
(0.02
|
)
|
|
(1,617
|
)
|
|
|
|
(0.02
|
)
|
Noncontrolling partners in consolidated joint ventures
|
|
(1,883
|
)
|
|
|
|
(0.02
|
)
|
|
(2,113
|
)
|
|
|
|
(0.02
|
)
|
Share of UJVs
|
|
15,636
|
|
|
|
|
0.18
|
|
|
18,954
|
|
|
|
|
0.21
|
|
Non-real estate depreciation
|
|
(987
|
)
|
|
|
|
(0.01
|
)
|
|
(1,152
|
)
|
|
|
|
(0.01
|
)
|
Less gain on insurance recoveries - The Mall of San Juan
|
|
|
|
|
|
|
|
(1,418
|
)
|
|
|
|
(0.02
|
)
|
Less gains on partial dispositions of ownership interests in UJVs
|
|
(363
|
)
|
|
|
|
—
|
|
|
|
|
|
|
|
Less gains on remeasurements of ownership interests in UJVs
|
|
(417
|
)
|
|
|
|
—
|
|
|
|
|
|
|
|
Less impact of share-based compensation
|
|
|
|
|
|
|
|
(7
|
)
|
|
|
|
—
|
|
Funds from Operations attributable to partnership unitholders
and participating securities of TRG
|
|
25,963
|
|
|
88,783,724
|
|
|
0.29
|
|
|
68,790
|
|
|
88,672,767
|
|
|
0.78
|
|
TCO's average ownership percentage of TRG - basic (1)
|
|
70.2
|
%
|
|
|
|
|
|
69.8
|
%
|
|
|
|
|
Funds from Operations attributable to TCO's common shareholders, excluding additional income tax expense
|
|
18,232
|
|
|
|
|
0.29
|
|
|
48,018
|
|
|
|
|
0.78
|
|
Less TCO's additional income tax expense
|
|
(19
|
)
|
|
|
|
—
|
|
|
|
|
|
|
|
Funds from Operations attributable to TCO's common shareholders (1)
|
|
18,213
|
|
|
|
|
0.29
|
|
|
48,018
|
|
|
|
|
0.78
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds from Operations attributable to partnership unitholders
and participating securities of TRG
|
|
25,963
|
|
|
88,783,724
|
|
|
0.29
|
|
|
68,790
|
|
|
88,672,767
|
|
|
0.78
|
|
Simon Property Group, Inc. transaction costs
|
|
9,060
|
|
|
|
|
0.10
|
|
|
|
|
|
|
|
Costs associated with shareholder activism
|
|
|
|
|
|
|
|
12,000
|
|
|
|
|
0.14
|
|
Restructuring charges
|
|
|
|
|
|
|
|
84
|
|
|
|
|
—
|
|
Costs related to Blackstone transactions (2)
|
|
|
|
|
|
|
|
2,066
|
|
|
|
|
0.02
|
|
Fluctuation in fair value of equity securities
|
|
1,535
|
|
|
|
|
0.02
|
|
|
|
|
|
|
|
Adjusted Funds from Operations attributable to partnership unitholders
and participating securities of TRG
|
|
36,558
|
|
|
88,783,724
|
|
|
0.41
|
|
|
82,940
|
|
|
88,672,767
|
|
|
0.94
|
|
TCO's average ownership percentage of TRG - basic (3)
|
|
70.2
|
%
|
|
|
|
|
|
69.8
|
%
|
|
|
|
|
Adjusted Funds from Operations attributable to TCO's common shareowners, excluding additional income tax expense
|
|
25,672
|
|
|
|
|
0.41
|
|
|
57,896
|
|
|
|
|
0.94
|
|
Less TCO's additional income tax expense
|
|
(19
|
)
|
|
|
|
—
|
|
|
|
|
|
|
|
Adjusted Funds from Operations attributable to TCO's common shareowners (3)
|
|
25,653
|
|
|
|
|
0.41
|
|
|
57,896
|
|
|
|
|
0.94
|
|
(1)
|
|
For the three months ended June 30, 2020, Funds from Operations attributable to TCO's common shareholders was $17,992 using TCO's diluted average ownership percentage of TRG of 69.4%. For the three months ended June 30, 2019, Funds from Operations attributable to TCO's common shareholders was $47,455 using TCO's diluted average ownership percentage of TRG of 69.0%.
|
(2)
|
|
For the three months ended June 30, 2019, includes $0.5 million of disposition costs and $1.6 million of deferred income tax expense related to the Blackstone transactions, which have been recorded within Nonoperating Income (Expense) and Income Tax Benefit (Expense), respectively, in our Statement of Operations and Comprehensive Income (Loss).
|
(3)
|
|
For the three months ended June 30, 2020, Adjusted Funds from Operations attributable to TCO's common shareholders was $25,342 using TCO's diluted average ownership percentage of TRG of 69.4%. For the three months ended June 30, 2019, Adjusted Funds from Operations attributable to TCO's common shareholders was $57,217 using TCO's diluted average ownership percentage of TRG of 69.0%.
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 5 - Reconciliation of Net Income (Loss) Attributable to Taubman Centers, Inc. Common Shareowners to Funds from Operations and Adjusted Funds from Operations
|
For the Six Months Ended June 30, 2020 and 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands of dollars except as noted; may not add or recalculate due to rounding)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020
|
|
2019
|
|
|
|
|
Shares
|
|
Per Share
|
|
|
|
Shares
|
|
Per Share
|
|
|
Dollars
|
|
/Units
|
|
/Unit
|
|
Dollars
|
|
/Units
|
|
/Unit
|
Net income (loss) attributable to TCO common shareholders - basic
|
|
(14,197
|
)
|
|
61,419,931
|
|
|
(0.23
|
)
|
|
21,356
|
|
|
61,147,947
|
|
|
0.35
|
|
Add impact of share-based compensation
|
|
|
|
|
|
|
|
28
|
|
|
206,481
|
|
|
|
Net income (loss) attributable to TCO common shareholders - diluted
|
|
(14,197
|
)
|
|
61,419,931
|
|
|
(0.23
|
)
|
|
21,384
|
|
|
61,354,428
|
|
|
0.35
|
|
Add TCO's additional income tax expense
|
|
19
|
|
|
|
|
—
|
|
|
|
|
|
|
|
Add depreciation of TCO's additional basis
|
|
2,962
|
|
|
|
|
0.05
|
|
|
3,234
|
|
|
|
|
0.05
|
|
Net income (loss) attributable to TCO common shareholders,
excluding step-up depreciation and additional income tax expense
|
|
(11,216
|
)
|
|
61,419,931
|
|
|
(0.18
|
)
|
|
24,618
|
|
|
61,354,428
|
|
|
0.40
|
|
Add noncontrolling share of income (loss) of TRG
|
|
(4,601
|
)
|
|
26,482,401
|
|
|
|
|
10,209
|
|
|
25,672,953
|
|
|
|
Add distributions to participating securities of TRG
|
|
595
|
|
|
871,262
|
|
|
|
|
1,220
|
|
|
871,262
|
|
|
|
Net income (loss) attributable to partnership unitholders and
participating securities of TRG
|
|
(15,222
|
)
|
|
88,773,594
|
|
|
(0.17
|
)
|
|
36,047
|
|
|
87,898,643
|
|
|
0.41
|
|
Add (less) depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
113,534
|
|
|
|
|
1.28
|
|
|
89,215
|
|
|
|
|
1.01
|
|
Depreciation of TCO's additional basis
|
|
(2,962
|
)
|
|
|
|
(0.03
|
)
|
|
(3,234
|
)
|
|
|
|
(0.04
|
)
|
Noncontrolling partners in consolidated joint ventures
|
|
(3,855
|
)
|
|
|
|
(0.04
|
)
|
|
(4,348
|
)
|
|
|
|
(0.05
|
)
|
Share of UJVs
|
|
32,033
|
|
|
|
|
0.36
|
|
|
36,146
|
|
|
|
|
0.41
|
|
Non-real estate depreciation
|
|
(2,184
|
)
|
|
|
|
(0.01
|
)
|
|
(2,297
|
)
|
|
|
|
(0.03
|
)
|
Less gain on insurance recoveries - The Mall of San Juan
|
|
|
|
|
|
|
|
(1,418
|
)
|
|
|
|
(0.02
|
)
|
Less gains on partial dispositions of ownership interests in UJVs, net of tax
|
|
(11,277
|
)
|
|
|
|
(0.13
|
)
|
|
|
|
|
|
|
Less gains on remeasurements of ownership interests in UJVs
|
|
(14,146
|
)
|
|
|
|
(0.16
|
)
|
|
|
|
|
|
|
Less impact of share-based compensation
|
|
|
|
|
|
|
|
(28
|
)
|
|
|
|
—
|
|
Funds from Operations attributable to partnership unitholders
and participating securities of TRG
|
|
95,921
|
|
|
88,773,594
|
|
|
1.08
|
|
|
150,083
|
|
|
87,898,643
|
|
|
1.71
|
|
TCO's average ownership percentage of TRG - basic (1)
|
|
70.0
|
%
|
|
|
|
|
|
70.4
|
%
|
|
|
|
|
Funds from Operations attributable to TCO's common shareholders, excluding additional income tax expense
|
|
67,109
|
|
|
|
|
1.08
|
|
|
105,797
|
|
|
|
|
1.71
|
|
Less TCO's additional income tax expense
|
|
(19
|
)
|
|
|
|
—
|
|
|
|
|
|
|
|
Funds from Operations attributable to TCO's common shareholders (1)
|
|
67,090
|
|
|
|
|
1.08
|
|
|
105,797
|
|
|
|
|
1.71
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds from Operations attributable to partnership unitholders
and participating securities of TRG
|
|
95,921
|
|
|
88,773,594
|
|
|
1.08
|
|
|
150,083
|
|
|
87,898,643
|
|
|
1.71
|
|
Simon Property Group, Inc. transaction costs
|
|
15,445
|
|
|
|
|
0.17
|
|
|
|
|
|
|
|
Costs associated with shareholder activism
|
|
|
|
|
|
|
|
16,000
|
|
|
|
|
0.18
|
|
Restructuring charges
|
|
362
|
|
|
|
|
—
|
|
|
709
|
|
|
|
|
0.01
|
|
Costs related to Blackstone transactions (2)
|
|
1,113
|
|
|
|
|
0.01
|
|
|
2,066
|
|
|
|
|
0.02
|
|
Taubman Asia President transition costs
|
|
244
|
|
|
|
|
—
|
|
|
|
|
|
|
|
Promote fee adjustment, net of tax - Starfield Hanam (3)
|
|
282
|
|
|
|
|
—
|
|
|
|
|
|
|
|
Fluctuation in fair value of equity securities
|
|
1,535
|
|
|
|
|
0.02
|
|
|
(3,346
|
)
|
|
|
|
(0.04
|
)
|
Adjusted Funds from Operations attributable to partnership unitholders
and participating securities of TRG
|
|
114,902
|
|
|
88,773,594
|
|
|
1.29
|
|
|
165,512
|
|
|
87,898,643
|
|
|
1.88
|
|
TCO's average ownership percentage of TRG - basic (4)
|
|
70.0
|
%
|
|
|
|
|
|
70.4
|
%
|
|
|
|
|
Funds from Operations attributable to TCO's common shareholders, excluding additional income tax expense
|
|
80,408
|
|
|
|
|
1.29
|
|
|
116,584
|
|
|
|
|
1.88
|
|
Less TCO's additional income tax expense
|
|
(19
|
)
|
|
|
|
—
|
|
|
|
|
|
|
|
Funds from Operations attributable to TCO's common shareholders (1)
|
|
80,389
|
|
|
|
|
1.29
|
|
|
116,584
|
|
|
|
|
1.88
|
|
(1)
|
|
For the six months ended June 30, 2020, Funds from Operations attributable to TCO's common shareholders was $66,265 using TCO's diluted average ownership percentage of TRG of 69.2%. For the six months ended June 30, 2019, Funds from Operations attributable to TCO's common shareholders was $104,474 using TCO's diluted average ownership percentage of TRG of 69.6%.
|
(2)
|
|
For the six months ended June 30, 2020, includes $1.1 million of deferred income tax expense related to the Blackstone transactions, which has been recorded within Income Tax Benefit (Expense) in our Statement of Operations and Comprehensive Income (Loss). For the six months ended June 30, 2019, includes $0.5 million of disposition costs and $1.6 million of deferred income tax expense related to the Blackstone transactions, which have been recorded within Nonoperating Income (Expense) and Income Tax Benefit (Expense), respectively, in our Statement of Operations and Comprehensive Income (Loss).
|
(3)
|
|
Includes a reduction of $0.3 million of promote fee income related to the previously recognized promote fee, net of tax, for Starfield Hanam, which have been recorded within Equity in Income of UJVs in our Statement of Operations and Comprehensive Income (Loss).
|
(4)
|
|
For the six months ended June 30, 2020, Adjusted Funds from Operations attributable to TCO's common shareholders was $79,402 using TCO's diluted average ownership percentage of TRG of 69.2%. For the six months ended June 30, 2019, Adjusted Funds from Operations attributable to TCO's common shareholders was $115,133 using TCO's diluted average ownership percentage of TRG of 69.6%.
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
Table 6 - Reconciliation of Net Income to Beneficial Interest in EBITDA and Adjusted Beneficial Interest in EBITDA
|
|
|
|
|
For the Periods Ended June 30, 2020 and 2019
|
|
|
|
|
|
|
|
|
(in thousands of dollars; amounts attributable to TCO may not recalculate due to rounding)
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year to Date
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Net income (loss)
|
|
(41,795
|
)
|
|
16,877
|
|
|
(5,311
|
)
|
|
46,615
|
|
|
|
|
|
|
|
|
|
|
Add (less) depreciation and amortization:
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
61,838
|
|
|
44,259
|
|
|
113,534
|
|
|
89,215
|
|
Noncontrolling partners in consolidated joint ventures
|
|
(1,883
|
)
|
|
(2,113
|
)
|
|
(3,855
|
)
|
|
(4,348
|
)
|
Share of UJVs
|
|
15,636
|
|
|
18,954
|
|
|
32,033
|
|
|
36,146
|
|
|
|
|
|
|
|
|
|
|
Add (less) interest expense and income tax expense (benefit):
|
|
|
|
|
|
|
|
|
Interest expense:
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
33,353
|
|
|
38,010
|
|
|
68,202
|
|
|
74,895
|
|
Noncontrolling partners in consolidated joint ventures
|
|
(2,748
|
)
|
|
(3,029
|
)
|
|
(5,544
|
)
|
|
(6,054
|
)
|
Share of UJVs
|
|
15,945
|
|
|
18,005
|
|
|
32,360
|
|
|
34,781
|
|
Income tax expense (benefit):
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
(248
|
)
|
|
2,364
|
|
|
508
|
|
|
2,903
|
|
Noncontrolling partners in consolidated joint ventures
|
|
|
|
(139
|
)
|
|
|
|
(189
|
)
|
Share of UJVs
|
|
104
|
|
|
912
|
|
|
429
|
|
|
1,689
|
|
Share of income tax expense on dispositions of ownership interests
|
|
|
|
|
|
1,482
|
|
|
|
|
|
|
|
|
|
|
|
|
Less noncontrolling share of income of consolidated joint ventures
|
|
(300
|
)
|
|
(832
|
)
|
|
(1,323
|
)
|
|
(2,261
|
)
|
|
|
|
|
|
|
|
|
|
Beneficial interest in EBITDA
|
|
79,902
|
|
|
133,268
|
|
|
232,515
|
|
|
273,392
|
|
|
|
|
|
|
|
|
|
|
TCO's average ownership percentage of TRG - basic
|
|
70.2
|
%
|
|
69.8
|
%
|
|
70.0
|
%
|
|
70.4
|
%
|
|
|
|
|
|
|
|
|
|
Beneficial interest in EBITDA attributable to TCO
|
|
56,109
|
|
|
93,027
|
|
|
162,785
|
|
|
192,620
|
|
|
|
|
|
|
|
|
|
|
Beneficial interest in EBITDA
|
|
79,902
|
|
|
133,268
|
|
|
232,515
|
|
|
273,392
|
|
|
|
|
|
|
|
|
|
|
Add (less):
|
|
|
|
|
|
|
|
|
Simon Property Group, Inc. transaction costs
|
|
9,060
|
|
|
|
|
15,445
|
|
|
|
Costs associated with shareowner activism
|
|
|
|
12,000
|
|
|
|
|
16,000
|
|
Restructuring charges
|
|
|
|
84
|
|
|
362
|
|
|
709
|
|
Disposition costs related to Blackstone transactions
|
|
|
|
487
|
|
|
|
|
487
|
|
Taubman Asia President transition costs
|
|
|
|
|
|
244
|
|
|
|
Promote fee adjustment - Starfield Hanam
|
|
|
|
|
|
309
|
|
|
|
Fluctuation in fair value of equity securities
|
|
1,535
|
|
|
|
|
1,535
|
|
|
(3,346
|
)
|
Gains on partial dispositions of ownership interests in UJVs
|
|
(363
|
)
|
|
|
|
(12,759
|
)
|
|
|
Gains on remeasurments of ownership interests in UJVs
|
|
(417
|
)
|
|
|
|
(14,146
|
)
|
|
|
Gain on insurance recoveries - The Mall of San Juan
|
|
|
|
(1,418
|
)
|
|
|
|
(1,418
|
)
|
|
|
|
|
|
|
|
|
|
Adjusted Beneficial interest in EBITDA
|
|
89,717
|
|
|
144,421
|
|
|
223,505
|
|
|
285,824
|
|
|
|
|
|
|
|
|
|
|
TCO's average ownership percentage of TRG - basic
|
|
70.2
|
%
|
|
69.8
|
%
|
|
70.0
|
%
|
|
70.4
|
%
|
|
|
|
|
|
|
|
|
|
Adjusted Beneficial interest in EBITDA attributable to TCO
|
|
63,001
|
|
|
100,812
|
|
|
156,519
|
|
|
201,314
|
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 7 - Reconciliation of Net Income (Loss) to Net Operating Income (NOI)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, 2020, 2019, and 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands of dollars)
|
|
Three Months Ended
|
|
Three Months Ended
|
|
|
2020
|
|
2019
|
|
Growth %
|
|
2019
|
|
2018
|
|
Growth %
|
Net income (loss)
|
|
(41,795
|
)
|
|
16,877
|
|
|
|
|
16,877
|
|
|
30,093
|
|
|
|
Add (less) depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
61,838
|
|
|
44,259
|
|
|
|
|
44,259
|
|
|
42,996
|
|
|
|
Noncontrolling partners in consolidated joint ventures
|
|
(1,883
|
)
|
|
(2,113
|
)
|
|
|
|
(2,113
|
)
|
|
(1,717
|
)
|
|
|
Share of UJVs
|
|
15,636
|
|
|
18,954
|
|
|
|
|
18,954
|
|
|
17,325
|
|
|
|
Add (less) interest expense and income tax expense (benefit):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
33,353
|
|
|
38,010
|
|
|
|
|
38,010
|
|
|
33,023
|
|
|
|
Noncontrolling partners in consolidated joint ventures
|
|
(2,748
|
)
|
|
(3,029
|
)
|
|
|
|
(3,029
|
)
|
|
(3,028
|
)
|
|
|
Share of UJVs
|
|
15,945
|
|
|
18,005
|
|
|
|
|
18,005
|
|
|
17,263
|
|
|
|
Income tax expense (benefit):
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
(248
|
)
|
|
2,364
|
|
|
|
|
2,364
|
|
|
28
|
|
|
|
Noncontrolling partners in consolidated joint ventures
|
|
|
|
(139
|
)
|
|
|
|
(139
|
)
|
|
(33
|
)
|
|
|
Share of UJVs
|
|
104
|
|
|
912
|
|
|
|
|
912
|
|
|
654
|
|
|
|
Less noncontrolling share of income of consolidated joint ventures
|
|
(300
|
)
|
|
(832
|
)
|
|
|
|
(832
|
)
|
|
(1,480
|
)
|
|
|
Add EBITDA attributable to outside partners:
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA attributable to noncontrolling partners in consolidated joint ventures
|
|
4,931
|
|
|
6,113
|
|
|
|
|
6,113
|
|
|
6,258
|
|
|
|
EBITDA attributable to outside partners in UJVs
|
|
39,531
|
|
|
49,119
|
|
|
|
|
49,119
|
|
|
46,206
|
|
|
|
EBITDA at 100%
|
|
124,364
|
|
|
188,500
|
|
|
|
|
188,500
|
|
|
187,588
|
|
|
|
Add (less) items excluded from shopping center NOI:
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
7,523
|
|
|
8,554
|
|
|
|
|
8,554
|
|
|
8,522
|
|
|
|
Management, leasing, and development services, net
|
|
(165
|
)
|
|
(401
|
)
|
|
|
|
(401
|
)
|
|
(418
|
)
|
|
|
Simon Property Group, Inc. transaction costs
|
|
9,060
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring charges
|
|
|
|
84
|
|
|
|
|
84
|
|
|
(77
|
)
|
|
|
Costs associated with shareholder activism
|
|
|
|
12,000
|
|
|
|
|
12,000
|
|
|
5,000
|
|
|
|
Straight-line of rents
|
|
4,097
|
|
|
(2,277
|
)
|
|
|
|
(2,277
|
)
|
|
(1,927
|
)
|
|
|
Nonoperating (income) expense
|
|
423
|
|
|
(7,550
|
)
|
|
|
|
(7,550
|
)
|
|
(12,882
|
)
|
|
|
Gain on partial disposition of ownership interest in UJV
|
|
(363
|
)
|
|
|
|
|
|
|
|
|
|
|
Gain on remeasurement of ownership interest in UJV
|
|
(417
|
)
|
|
|
|
|
|
|
|
|
|
|
Unallocated operating expenses and other
|
|
4,969
|
|
|
8,382
|
|
|
|
|
8,382
|
|
|
8,402
|
|
|
|
NOI at 100% - total portfolio
|
|
149,491
|
|
|
207,292
|
|
|
|
|
207,292
|
|
|
194,208
|
|
|
|
Less - NOI of non-comparable centers
|
|
(8,655
|
)
|
(1)
|
(22,075
|
)
|
(1)
|
|
|
(18,193
|
)
|
(2)
|
(9,567
|
)
|
(2)
|
|
NOI at 100% - comparable centers
|
|
140,836
|
|
|
185,217
|
|
|
(24.0)%
|
|
189,099
|
|
|
184,641
|
|
|
2.4%
|
Foreign currency exchange rate fluctuation adjustment
|
|
1,023
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers including lease cancellation income at constant currency
|
|
141,859
|
|
|
185,217
|
|
|
(23.4)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers
|
|
140,836
|
|
|
185,217
|
|
|
|
|
189,099
|
|
|
184,641
|
|
|
|
Less lease cancellation income - comparable centers
|
|
(5,041
|
)
|
|
(4,954
|
)
|
|
|
|
(5,946
|
)
|
|
(2,060
|
)
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income
|
|
135,795
|
|
|
180,263
|
|
|
(24.7)%
|
|
183,153
|
|
|
182,581
|
|
|
0.3%
|
Foreign currency exchange rate fluctuation adjustment
|
|
1,023
|
|
|
|
|
|
|
2,017
|
|
|
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income at constant currency
|
|
136,818
|
|
|
180,263
|
|
|
(24.1)%
|
|
185,170
|
|
|
182,581
|
|
|
1.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers
|
|
140,836
|
|
|
185,217
|
|
|
|
|
|
|
|
|
|
Less NOI of comparable centers attributable to noncontrolling partners in consolidated joint ventures and outside partners in UJVs
|
|
(42,659
|
)
|
|
(54,713
|
)
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers including lease cancellation income
|
|
98,177
|
|
|
130,504
|
|
|
(24.8)%
|
|
|
|
|
|
|
Beneficial interest in foreign currency exchange rate fluctuation adjustment
|
|
219
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers including lease cancellation income at constant currency
|
|
98,396
|
|
|
130,504
|
|
|
(24.6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income
|
|
135,795
|
|
|
180,263
|
|
|
|
|
|
|
|
|
|
Less NOI of comparable centers excluding lease cancellation income attributable to noncontrolling partners in consolidated joint ventures and outside partners in UJVs
|
|
(41,511
|
)
|
|
(53,693
|
)
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers excluding lease cancellation income
|
|
94,284
|
|
|
126,570
|
|
|
(25.5)%
|
|
|
|
|
|
|
Beneficial interest in foreign currency exchange rate fluctuation adjustment
|
|
219
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers excluding lease cancellation income at constant currency
|
|
94,503
|
|
|
126,570
|
|
|
(25.3)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - total portfolio
|
|
149,491
|
|
|
207,292
|
|
|
|
|
207,292
|
|
|
194,208
|
|
|
|
Less lease cancellation income - total portfolio
|
|
(5,290
|
)
|
|
(7,431
|
)
|
|
|
|
(7,431
|
)
|
|
(2,060
|
)
|
|
|
Less NOI attributable to noncontrolling partners in consolidated joint ventures and outside partners in UJVs excluding lease cancellation income - total portfolio
|
|
(43,441
|
)
|
|
(54,341
|
)
|
|
|
|
(54,341
|
)
|
|
(52,962
|
)
|
|
|
Beneficial interest in NOI - total portfolio excluding lease cancellation income
|
|
100,760
|
|
|
145,520
|
|
|
(30.8)%
|
|
145,520
|
|
|
139,186
|
|
|
4.6%
|
(1)
|
|
Includes Beverly Center, The Gardens Mall, The Mall of San Juan, Stamford Town Center, and Taubman Prestige Outlets Chesterfield.
|
(2)
|
|
Includes Beverly Center, The Gardens Mall, The Mall of San Juan, and Taubman Prestige Outlets Chesterfield.
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 8 - Reconciliation of Net Income (Loss) to Net Operating Income (NOI)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2020, 2019, and 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands of dollars)
|
|
Year to Date
|
|
Year to Date
|
|
|
2020
|
|
2019
|
|
Growth %
|
|
2019
|
|
2018
|
|
Growth %
|
Net income (loss)
|
|
(5,311
|
)
|
|
46,615
|
|
|
|
|
46,615
|
|
|
64,689
|
|
|
|
Add (less) depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
113,534
|
|
|
89,215
|
|
|
|
|
89,215
|
|
|
78,018
|
|
|
|
Noncontrolling partners in consolidated joint ventures
|
|
(3,855
|
)
|
|
(4,348
|
)
|
|
|
|
(4,348
|
)
|
|
(3,569
|
)
|
|
|
Share of UJVs
|
|
32,033
|
|
|
36,146
|
|
|
|
|
36,146
|
|
|
34,380
|
|
|
|
Add (less) interest expense and income tax expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
68,202
|
|
|
74,895
|
|
|
|
|
74,895
|
|
|
63,846
|
|
|
|
Noncontrolling partners in consolidated joint ventures
|
|
(5,544
|
)
|
|
(6,054
|
)
|
|
|
|
(6,054
|
)
|
|
(6,039
|
)
|
|
|
Share of UJVs
|
|
32,360
|
|
|
34,781
|
|
|
|
|
34,781
|
|
|
34,014
|
|
|
|
Income tax expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated businesses at 100%
|
|
508
|
|
|
2,903
|
|
|
|
|
2,903
|
|
|
212
|
|
|
|
Noncontrolling partners in consolidated joint ventures
|
|
|
|
(189
|
)
|
|
|
|
(189
|
)
|
|
(83
|
)
|
|
|
Share of UJVs
|
|
429
|
|
|
1,689
|
|
|
|
|
1,689
|
|
|
1,364
|
|
|
|
Share of income tax expense on disposition of ownership interests
|
|
1,482
|
|
|
|
|
|
|
|
|
|
|
|
Less noncontrolling share of income of consolidated joint ventures
|
|
(1,323
|
)
|
|
(2,261
|
)
|
|
|
|
(2,261
|
)
|
|
(2,824
|
)
|
|
|
Add EBITDA attributable to outside partners:
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA attributable to noncontrolling partners in consolidated joint ventures
|
|
10,722
|
|
|
12,852
|
|
|
|
|
12,852
|
|
|
12,515
|
|
|
|
EBITDA attributable to outside partners in UJVs
|
|
90,810
|
|
|
96,263
|
|
|
|
|
96,263
|
|
|
97,233
|
|
|
|
EBITDA at 100%
|
|
334,047
|
|
|
382,507
|
|
|
|
|
382,507
|
|
|
373,756
|
|
|
|
Add (less) items excluded from shopping center NOI:
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
15,539
|
|
|
17,130
|
|
|
|
|
17,130
|
|
|
17,015
|
|
|
|
Management, leasing, and development services, net
|
|
(238
|
)
|
|
(1,086
|
)
|
|
|
|
(1,086
|
)
|
|
(910
|
)
|
|
|
Simon Property Group, Inc. transaction costs
|
|
15,445
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring charges
|
|
362
|
|
|
709
|
|
|
|
|
709
|
|
|
(423
|
)
|
|
|
Costs associated with shareholder activism
|
|
|
|
16,000
|
|
|
|
|
16,000
|
|
|
8,500
|
|
|
|
Straight-line of rents
|
|
3,068
|
|
|
(5,184
|
)
|
|
|
|
(5,184
|
)
|
|
(7,414
|
)
|
|
|
Nonoperating income, net
|
|
(462
|
)
|
|
(16,684
|
)
|
|
|
|
(16,684
|
)
|
|
(6,086
|
)
|
|
|
Gains on partial dispositions of ownership interests in UJVs
|
|
(12,759
|
)
|
|
|
|
|
|
|
|
|
|
|
Gains on remeasurements of ownership interests in UJVs
|
|
(14,146
|
)
|
|
|
|
|
|
|
|
|
|
|
Unallocated operating expenses and other
|
|
9,976
|
|
|
16,122
|
|
|
|
|
16,122
|
|
|
16,523
|
|
|
|
NOI at 100% - total portfolio
|
|
350,832
|
|
|
409,514
|
|
|
|
|
409,514
|
|
|
400,961
|
|
|
|
Less - NOI of non-comparable centers
|
|
(26,757
|
)
|
(1)
|
(36,341
|
)
|
(1)
|
|
|
(29,931
|
)
|
(2)
|
(18,828
|
)
|
(2)
|
|
NOI at 100% - comparable centers
|
|
324,075
|
|
|
373,173
|
|
|
(13.2)%
|
|
379,583
|
|
|
382,133
|
|
|
(0.7)%
|
Foreign currency exchange rate fluctuation adjustment
|
|
2,152
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers including lease cancellation income at constant currency
|
|
326,227
|
|
|
373,173
|
|
|
(12.6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers
|
|
324,075
|
|
|
373,173
|
|
|
|
|
379,583
|
|
|
382,133
|
|
|
|
Less lease cancellation income - comparable centers
|
|
(7,095
|
)
|
|
(5,443
|
)
|
|
|
|
(6,435
|
)
|
|
(13,744
|
)
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income
|
|
316,980
|
|
|
367,730
|
|
|
(13.8)%
|
|
373,148
|
|
|
368,389
|
|
|
1.3%
|
Foreign currency exchange rate fluctuation adjustment
|
|
2,152
|
|
|
|
|
|
|
3,370
|
|
|
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income at constant currency
|
|
319,132
|
|
|
367,730
|
|
|
(13.2)%
|
|
376,518
|
|
|
368,389
|
|
|
2.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers
|
|
324,075
|
|
|
373,173
|
|
|
|
|
|
|
|
|
|
Less NOI of comparable centers attributable to noncontrolling partners in consolidated joint ventures and outside partners in UJVs
|
|
(96,525
|
)
|
|
(112,604
|
)
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers including lease cancellation income
|
|
227,550
|
|
|
260,569
|
|
|
(12.7)%
|
|
|
|
|
|
|
Beneficial interest in foreign currency exchange rate fluctuation adjustment
|
|
451
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers including lease cancellation income at constant currency
|
|
228,001
|
|
|
260,569
|
|
|
(12.5)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - comparable centers excluding lease cancellation income
|
|
316,980
|
|
(1)
|
367,730
|
|
(1)
|
|
|
|
|
|
|
|
Less NOI of comparable centers excluding lease cancellation income attributable to noncontrolling partners in consolidated joint ventures and outside partners in UJVs
|
|
(95,179
|
)
|
|
(111,499
|
)
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers excluding lease cancellation income
|
|
221,801
|
|
|
256,231
|
|
|
(13.4)%
|
|
|
|
|
|
|
Beneficial interest in foreign currency exchange rate fluctuation adjustment
|
|
451
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial interest in NOI - comparable centers excluding lease cancellation income at constant currency
|
|
222,252
|
|
|
256,231
|
|
|
(13.3)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOI at 100% - total portfolio
|
|
350,832
|
|
|
409,514
|
|
|
|
|
409,514
|
|
|
400,961
|
|
|
|
Less lease cancellation income - total portfolio
|
|
(7,742
|
)
|
|
(8,000
|
)
|
|
|
|
(8,000
|
)
|
|
(15,845
|
)
|
|
|
Less NOI attributable to noncontrolling partners in consolidated joint ventures and outside partners in UJVs excluding lease cancellation income - total portfolio
|
|
(100,771
|
)
|
|
(108,914
|
)
|
|
|
|
(108,914
|
)
|
|
(106,839
|
)
|
|
|
Beneficial interest in NOI - total portfolio excluding lease cancellation income
|
|
242,319
|
|
|
292,600
|
|
|
(17.2)%
|
|
292,600
|
|
|
278,277
|
|
|
5.1%
|
(1)
|
|
Includes Beverly Center, The Gardens Mall, The Mall of San Juan, Stamford Town Center, and Taubman Prestige Outlets Chesterfield.
|
(2)
|
|
Includes Beverly Center, The Gardens Mall, The Mall of San Juan, and Taubman Prestige Outlets Chesterfield.
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 9 - Debt Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of June 30, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions of dollars, amounts may not add due to rounding)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ownership %
|
|
Amortizing (A)/
|
|
Maturity
|
|
100%
|
|
Beneficial Interest
|
|
Effective Rate
|
|
LIBOR Rate
|
|
|
Consolidated Fixed Rate Debt:
|
|
(if not 100%)
|
|
Interest Only (I)
|
|
Date
|
|
6/30/2020
|
|
6/30/2020
|
(a)
|
6/30/2020
|
(b)
|
Spread
|
|
|
Cherry Creek Shopping Center
|
|
50.00
|
%
|
|
I
|
|
6/1/2028
|
|
550.0
|
|
|
275.0
|
|
|
3.85
|
%
|
|
|
|
|
City Creek Center
|
|
|
|
A
|
|
8/1/2023
|
|
74.5
|
|
|
74.5
|
|
|
4.37
|
%
|
|
|
|
|
Great Lakes Crossing Outlets
|
|
|
|
A
|
|
1/6/2023
|
|
190.9
|
|
|
190.9
|
|
|
3.60
|
%
|
|
|
|
|
The Mall at Short Hills
|
|
|
|
I
|
|
10/1/2027
|
|
1,000.0
|
|
|
1,000.0
|
|
|
3.48
|
%
|
|
|
|
|
Twelve Oaks Mall
|
|
|
|
A
|
|
3/6/2028
|
|
290.0
|
|
|
290.0
|
|
|
4.85
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
2,105.4
|
|
|
1,830.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.81
|
%
|
|
3.80
|
%
|
|
|
|
|
|
|
Consolidated Floating Rate Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Mall at Green Hills
|
|
|
|
I
|
|
12/1/2020
|
(c)
|
150.0
|
|
|
150.0
|
|
|
1.62
|
%
|
(c)
|
1.45%
|
|
(c)
|
International Market Place
|
|
93.50
|
%
|
|
I
|
|
8/9/2021
|
(d)
|
250.0
|
|
|
233.8
|
|
|
2.32
|
%
|
|
2.15%
|
|
(d)
|
TRG $65M Revolving Credit Facility
|
|
|
|
I
|
|
4/24/2021
|
|
0.0
|
|
(e)
|
0.0
|
|
|
1.56
|
%
|
(e)
|
1.40%
|
|
|
TRG $1.1B Revolving Credit Facility
|
|
|
|
I
|
|
2/1/2024
|
(f)
|
845.0
|
|
|
845.0
|
|
|
1.55
|
%
|
(f)
|
1.38%
|
|
(f)
|
|
|
|
|
|
|
|
|
1,245.0
|
|
|
1,228.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.71
|
%
|
|
1.70
|
%
|
|
|
|
|
|
|
Consolidated Floating Rate Debt Swapped to Fixed:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TRG $275M Term Loan
|
|
|
|
I
|
|
2/1/2025
|
|
275.0
|
|
|
275.0
|
|
|
3.69
|
%
|
(g)
|
1.55%
|
|
(g)
|
TRG $250M Term Loan
|
|
|
|
I
|
|
3/31/2023
|
|
250.0
|
|
|
250.0
|
|
|
4.62
|
%
|
(h)
|
1.60%
|
|
(h)
|
TRG $1.1B Revolving Credit Facility (portion swapped)
|
|
|
|
I
|
|
2/1/2024
|
(f)
|
25.0
|
|
|
25.0
|
|
|
3.51
|
%
|
(f)
|
1.38%
|
|
(f)
|
U.S. Headquarters
|
|
|
|
I
|
|
3/1/2024
|
|
12.0
|
|
|
12.0
|
|
|
3.49
|
%
|
(i)
|
|
|
|
|
|
|
|
|
|
|
|
562.0
|
|
|
562.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.09
|
%
|
|
4.09
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Consolidated Deferred Financing Costs, Net
|
|
|
|
|
|
|
|
(11.4
|
)
|
|
(10.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Consolidated
|
|
|
|
|
|
|
|
3,900.9
|
|
|
3,610.2
|
|
|
|
|
|
|
|
Weighted Rate (excluding deferred financing costs)
|
|
|
|
|
|
|
|
3.18
|
%
|
|
3.13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joint Ventures Fixed Rate Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CityOn.Xi'an
|
|
25.00
|
%
|
|
A
|
|
3/14/2029
|
|
152.0
|
|
(j)
|
38.0
|
|
|
6.00
|
%
|
|
|
|
|
CityOn.Zhengzhou
|
|
24.50
|
%
|
|
A
|
|
3/22/2032
|
|
73.5
|
|
(k)
|
18.0
|
|
|
5.60
|
%
|
(k)
|
|
|
|
Country Club Plaza
|
|
50.00
|
%
|
|
A
|
(l)
|
4/1/2026
|
|
313.7
|
|
|
156.9
|
|
|
3.85
|
%
|
|
|
|
|
Fair Oaks Mall
|
|
50.00
|
%
|
|
A
|
|
5/10/2023
|
|
252.7
|
|
|
126.4
|
|
|
5.32
|
%
|
|
|
|
|
The Gardens Mall
|
|
48.50
|
%
|
|
I - until
8/15/2021
|
(m)
|
7/15/2025
|
(m)
|
195.0
|
|
|
105.3
|
|
(m)
|
4.09
|
%
|
(m)
|
|
|
|
International Plaza
|
|
50.10
|
%
|
|
A
|
|
12/1/2021
|
|
294.7
|
|
|
147.6
|
|
|
4.85
|
%
|
|
|
|
|
The Mall at Millenia
|
|
50.00
|
%
|
|
I
|
|
10/15/2024
|
|
350.0
|
|
|
175.0
|
|
|
4.00
|
%
|
|
|
|
|
The Mall at Millenia
|
|
50.00
|
%
|
|
I
|
|
10/15/2024
|
|
100.0
|
|
|
50.0
|
|
|
3.75
|
%
|
|
|
|
|
Starfield Anseong
|
|
49.00
|
%
|
|
I
|
|
2/28/2025
|
|
129.9
|
|
(n)
|
63.7
|
|
|
2.22
|
%
|
(n)
|
|
|
|
Starfield Hanam
|
|
17.15
|
%
|
|
I
|
|
11/25/2020
|
|
257.4
|
|
(o)
|
44.1
|
|
|
2.58
|
%
|
(o)
|
|
|
|
Sunvalley
|
|
50.00
|
%
|
|
A
|
|
9/1/2022
|
|
163.0
|
|
|
81.5
|
|
|
4.44
|
%
|
|
|
|
|
Taubman Land Associates
|
|
50.00
|
%
|
|
A
|
|
11/1/2022
|
|
20.4
|
|
|
10.2
|
|
|
3.84
|
%
|
|
|
|
|
The Mall at University Town Center
|
|
50.00
|
%
|
|
I - until
12/1/2022
|
|
11/1/2026
|
|
280.0
|
|
|
140.0
|
|
|
3.40
|
%
|
|
|
|
|
Waterside Shops
|
|
50.00
|
%
|
|
I
|
(p)
|
4/15/2026
|
|
165.0
|
|
|
82.5
|
|
|
3.86
|
%
|
|
|
|
|
Westfarms
|
|
78.94
|
%
|
|
A
|
|
7/1/2022
|
|
272.0
|
|
|
214.7
|
|
|
4.50
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
3,019.4
|
|
|
1,453.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.12
|
%
|
|
4.17
|
%
|
|
|
|
|
|
|
Joint Venture Floating Rate Debt Swapped to Fixed:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Plaza
|
|
50.10
|
%
|
|
A
|
|
12/1/2021
|
|
156.7
|
|
|
78.5
|
|
|
3.58
|
%
|
(q)
|
|
|
|
Starfield Hanam
|
|
17.15
|
%
|
|
I
|
|
11/8/2020
|
|
52.1
|
|
(r)
|
8.9
|
|
|
3.12
|
%
|
(r)
|
|
|
|
|
|
|
|
|
|
|
|
208.8
|
|
|
87.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.46
|
%
|
|
3.53
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Joint Venture Deferred Financing Costs, Net
|
|
|
|
|
|
|
|
(7.7
|
)
|
|
(3.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Joint Venture
|
|
|
|
|
|
|
|
3,220.5
|
|
|
1,537.7
|
|
|
|
|
|
|
|
Weighted Rate (excluding deferred financing costs)
|
|
|
|
|
|
|
|
4.08
|
%
|
|
4.13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TRG Beneficial Interest Totals:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Rate Debt
|
|
|
|
|
|
|
|
5,124.8
|
|
|
3,284.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.99
|
%
|
|
3.96
|
%
|
|
|
|
|
|
|
Floating Rate Debt
|
|
|
|
|
|
|
|
1,245.0
|
|
|
1,228.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.71
|
%
|
|
1.70
|
%
|
|
|
|
|
|
|
Floating Rate Debt Swapped to Fixed
|
|
|
|
|
|
|
|
770.8
|
|
|
649.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.92
|
%
|
|
4.01
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Deferred Financing Costs, Net
|
|
|
|
|
|
|
|
(19.1
|
)
|
|
(14.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
7,121.5
|
|
|
5,147.9
|
|
|
|
|
|
|
|
Weighted Rate (excluding deferred financing costs)
|
|
|
|
|
|
|
|
3.59
|
%
|
|
3.43
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Maturity Fixed Debt
|
|
|
|
|
|
5.8
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Maturity Total Debt
|
|
|
|
|
|
5.0
|
|
|
|
|
|
|
|
|
|
|
|
TAUBMAN CENTERS, INC.
|
|
|
|
|
|
|
|
|
|
|
|
Table 9 - Debt Summary (continued)
|
|
|
|
|
|
|
|
|
|
|
|
As of June 30, 2020
|
|
|
|
|
|
|
|
|
|
|
|
(in millions of dollars, amounts may not add due to rounding)
|
|
|
|
|
|
|
|
|
Beneficial Share of Principal Amortization and Debt Maturities
|
Year
|
|
Fixed Rate Debt (s)
|
Weighted
Rate
|
|
Floating Rate Debt
|
Weighted
Rate
|
|
Floating Swapped
to Fixed (t)
|
Weighted
Rate (t)
|
|
Total Deferred
Financing Costs,
Net
|
|
Total Debt
|
Weighted
Rate
|
2020
|
|
60.4
|
|
3.09
|
%
|
|
150.0
|
|