BOSTON, Nov. 13 /PRNewswire/ -- Boston Properties, Inc. (NYSE: BXP) plans
to file its Form 10-Q tomorrow, November 14, 2001, with results for the third
quarter ended September 30, 2001.
The net income to be reported in the Form 10-Q will include additional
non-cash revenue of $12.4 million as compared to information disclosed in the
press release and Form 8-K filed on October 23rd. This potential adjustment
was previously discussed by management during their third quarter earnings
conference call which was held on October 24th and does not change the Funds
from Operations (FFO) as reported of $0.91 per share diluted.
At the time of the October 24th conference call, the Company and its
auditors were still reviewing the accounting treatment associated with revenue
generated from the surrender of certain space at its 875 Third Avenue property
in New York City. The Company and its auditors have since determined that all
of the payments to be made in association with that surrender will be
recognized in income in the third quarter of 2001. This results in a
$10.1 million (net of minority interest share of $2.3 million) non-cash
increase to net income available to common shareholders for the quarter. Net
income available to common shareholders for the third quarter is $51.5 million
($0.56 per share diluted), rather than $41.4 million ($0.45 per share diluted)
as reported on October 23rd.
Consistent with its historical practice, Boston Properties will recognize
this early surrender income in its Funds from Operations as cash is actually
received over the remaining term of the lease. Boston Properties expects to
receive approximately $1.3 million per month from October 1, 2001 to July 15,
2002. These amounts will be included in FFO and identified separately in each
quarter as received. The Company's previously disclosed 2001 and 2002 FFO
guidance remains unchanged. Net income guidance for 2001 and 2002 after
adjusting for this non-cash item is also unchanged.
Boston Properties is a fully integrated, self-administered and self-
managed real estate investment trust that develops, redevelops, acquires,
manages, operates and owns a diverse portfolio of Class A office, industrial
and hotel properties. The Company is one of the largest owners and developers
of Class A office properties in the United States, concentrated in four core
markets -- Boston, Midtown Manhattan, Washington, DC and San Francisco.
This press release contains forward-looking statements within the meaning
of the Federal securities laws. You should exercise caution in interpreting
and relying on forward-looking statements because they involve known and
unknown risks, uncertainties and other factors which are, in some cases,
beyond Boston Properties' control and could materially affect actual results,
performance or achievements. These factors include, without limitation, the
ability to enter into new leases or renew leases on favorable terms,
dependence on tenants' financial condition, the uncertainties of real estate
development and acquisition activity, the ability to effectively integrate
acquisitions, the costs and availability of financing, the effects of local
economic and market conditions, regulatory changes and other risks and
uncertainties detailed from time to time in the Company's filings with the
Securities and Exchange Commission.
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000
(unaudited and in thousands, except for
per share amounts)
Revenue
Rental:
Base rent $232,300 $183,749 $626,062 $532,039
Recoveries from tenants 27,473 22,886 80,917 68,956
Parking and other 12,965 12,798 40,244 38,095
Total rental revenue 272,738 219,433 747,223 639,090
Development and management
services 2,805 2,693 9,312 8,432
Interest and other 1,616 1,187 10,349 3,304
Total revenue 277,159 223,313 766,884 650,826
Expenses
Operating 81,475 68,154 228,683 197,366
General and administrative 9,819 9,871 29,649 25,868
Interest 59,936 54,752 163,659 166,210
Depreciation and amortization 38,518 32,436 109,933 97,062
Loss on investments in
securities - - 6,500 -
Total expenses 189,748 165,213 538,424 486,506
Income before net derivative
losses, minority interests and
income from unconsolidated joint
ventures 87,411 58,100 228,460 164,320
Net derivative losses (16,620) - (24,408) -
Minority interests in property
partnerships 374 (245) 629 (681)
Income from unconsolidated joint
ventures 997 549 2,841 1,356
Income before minority interest
in Operating Partnership 72,162 58,404 207,522 164,995
Minority interest in Operating
Partnership (18,994) (19,627) (56,156) (56,505)
Income before gain (loss) on sale
of real estate 53,168 38,777 151,366 108,490
Gain (loss) on sale of real
estate, net of minority interest - (604) 6,505 (307)
Income before cumulative effect
of a change in accounting
principle 53,168 38,173 157,871 108,183
Cumulative effect of a change in
accounting principle, net of
minority interest - - (6,767) -
Net income before preferred
dividend 53,168 38,173 151,104 108,183
Preferred dividend (1,653) (1,643) (4,944) (4,929)
Net income available to common
shareholders $51,515 $36,530 $146,160 $103,254
Basic earnings per share:
Income before gain (loss) on
sale of real estate and
cumulative effect of a
change in accounting
principle $0.57 $0.54 $1.63 $1.51
Gain (loss) on sale of real
estate, net of minority
interest - (0.01) 0.07 -
Cumulative effect of a change
in accounting principle, net
of minority interest - - (0.07) -
Net income available to common
shareholders $0.57 $0.53 $1.63 $1.51
Weighted average number of
common shares outstanding 90,519 68,752 89,753 68,568
Diluted earnings per share:
Income before gain (loss) on
sale of real estate and
cumulative effect of a
change in accounting
principle $0.56 $0.53 $1.59 $1.49
Gain (loss) on sale of real
estate, net of minority
interest - (0.01) 0.07 (0.01)
Cumulative effect of a change
in accounting principle, net
of minority interest - - (0.07) -
Net income available to common
shareholders $0.56 $0.52 $1.59 $1.48
Weighted average number of
common and common
equivalent shares outstanding 92,828 70,661 92,004 69,600
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2001 2000
(unaudited)
(in thousands, except for share
amounts)
ASSETS
Real estate: $7,297,980 $6,112,779
Less: accumulated depreciation (683,029) (586,719)
Total real estate 6,614,951 5,526,060
Cash and cash equivalents 161,011 280,957
Escrows 20,901 85,561
Investments in securities 4,297 7,012
Tenant and other receivables 41,087 26,852
Accrued rental income 110,441 91,684
Deferred charges, net 104,370 77,319
Prepaid expenses and other assets 46,303 41,154
Investments in unconsolidated joint
ventures 90,160 89,871
Total assets $7,193,521 $6,226,470
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes and bonds payable $4,245,433 $3,414,891
Accounts payable and accrued
expenses 71,716 57,338
Dividends and distributions
payable 79,005 71,274
Interest rate contracts 32,136 -
Accrued interest payable 15,679 5,599
Other liabilities 52,969 51,926
Total liabilities 4,496,938 3,601,028
Commitments and contingencies - -
Minority interests 847,232 877,715
Series A Convertible Redeemable
Preferred Stock, liquidation
preference $50.00 per share,
2,000,000 shares issued
and outstanding 100,000 100,000
Stockholders' equity:
Excess stock, $.01 par value,
150,000,000 shares
authorized, none issued or
outstanding - -
Common stock, $.01 par value,
250,000,000 shares
authorized, 90,720,477 and
86,630,089 issued and
outstanding in 2001 and 2000,
respectively 907 866
Additional paid-in capital 1,784,850 1,673,349
Dividends in excess of earnings (20,296) (13,895)
Unearned compensation (2,242) (848)
Accumulated other comprehensive
loss (13,868) (11,745)
Total stockholders' equity 1,749,351 1,647,727
Total liabilities and
stockholders' equity $7,193,521 $6,226,470
BOSTON PROPERTIES, INC.
FUNDS FROM OPERATIONS
(unaudited and in thousands)
Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000
Income before net derivative losses
(SFAS No. 133), minority interests
and income from unconsolidated
joint ventures $87,411 $58,100 $228,460 $164,320
Add:
Real estate depreciation and
amortization 39,360 33,007 112,516 97,556
Income from unconsolidated joint
ventures 997 549 2,841 1,356
Less:
Net derivative losses
(SFAS No. 133) (16,620) - (24,408) -
Minority property partnerships'
share of funds from operations (832) (284) (1,546) (774)
Preferred dividends and
distributions (8,383) (8,248) (24,864) (24,748)
Funds from operations $101,933 $83,124 $292,999 $237,710
Add:
Net derivative losses
(SFAS No. 133) 16,620 - 24,408 -
Less:
Non-cash early surrender lease
income (12,445) - (12,445) -
Funds from operations before net
derivative losses (SFAS No. 133)
and non-cash early surrender
lease income $106,108 $83,124 $304,962 $237,710
Funds from operations available to
common shareholders before net
derivative losses (SFAS No. 133)
and non-cash early surrender
lease income $86,627 $61,543 $247,210 $175,526
Weighted average shares outstanding
- basic 90,519 68,752 89,753 68,568
FFO per share basic before net
derivative losses (SFAS No. 133)
and non-cash early surrender
lease income $0.96 $0.90 $2.76 $2.56
FFO per share basic after net
derivative losses (SFAS No. 133)
and non-cash early surrender
lease income $0.92 $0.90 $2.65 $2.56
Weighted average shares outstanding
- diluted 105,812 83,657 104,991 82,600
FFO per share diluted before net
derivative losses (SFAS No. 133)
and non-cash early surrender
lease income $0.91 $0.85 $2.62 $2.46
FFO per share diluted after net
derivative losses (SFAS No. 133)
and non-cash early surrender
lease income $0.87 $0.85 $2.53 $2.46
SOURCE Boston Properties, Inc.
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CONTACT:
Douglas T. Linde, Chief Financial Officer of
Boston Properties, Inc., +1-617-236-3300, or General, Marilynn
Meek, +1-212-445-8431, or Analysts, Claire Koeneman,
+1-312-266-7800, or Media, Judith Sylk-Siegel, +1-212-445-8431,
all of FRB Weber Shandwick
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