EX-99 2 exhibit991.htm EXHIBIT 99.1 exhibit991.htm - Generated by SEC Publisher for SEC Filing

EXHIBIT 99.1

CONTACT:

JOSEPH MACNOW

 

 

 

(201) 587-1000

 

 

 

 

 

Vornado Logo 282

 

 

 

888 Seventh Avenue

 

 

 

New York, NY 10019

 

 

FOR IMMEDIATE RELEASE – July 31, 2017

 

Vornado Announces Second Quarter 2017 Financial Results

 

NEW YORK.......VORNADO REALTY TRUST (New York Stock Exchange: VNO) filed its Form 10-Q for the quarter ended June 30, 2017 today and reported:

 

Quarter Ended June 30, 2017 Financial Results

 

·         NET INCOME attributable to common shareholders for the quarter ended June 30, 2017 was $116.0 million, or $0.61 per diluted share, compared to $220.5 million, or $1.16 per diluted share, for the prior year’s quarter.  Adjusting net income attributable to common shareholders (non-GAAP) for the items listed in the table on the following page, net income attributable to common shareholders for the quarters ended June 30, 2017 and 2016 was $82.0 million and $66.5 million, or $0.43 and $0.35 per diluted share, respectively.

·         FUNDS FROM OPERATIONS attributable to common shareholders plus assumed conversions (non-GAAP) (“FFO”) for the quarter ended June 30, 2017 was $257.7 million, or $1.35 per diluted share, compared to $229.4 million, or $1.21 per diluted share, for the prior year’s quarter.  Adjusting FFO for the items listed in the table on page 3, FFO for the quarters ended June 30, 2017 and 2016 was $237.9 million and $225.0 million, or $1.25 and $1.19 per diluted share, respectively.

 

Six Months Ended June 30, 2017 Financial Results

 

·         NET INCOME attributable to common shareholders for the six months ended June 30, 2017 was $163.7 million, or $0.86 per diluted share, compared to $106.3 million, or $0.56 per diluted share, for the six months ended June 30, 2016.  Adjusting net income attributable to common shareholders for the items listed in the table on the following page, net income attributable to common shareholders for the six months ended June 30, 2017 and 2016 was $138.6 million and $107.2 million, or $0.73 and $0.56 per diluted share, respectively.

·         FFO for the six months ended June 30, 2017 was $463.4 million, or $2.43 per diluted share, compared to $433.1 million, or $2.28 per diluted share, for the prior year’s six months.  Adjusting FFO for the items listed in the table on page 3, FFO for the six months ended June 30, 2017 and 2016 was $453.6 million and $424.0 million, or $2.38 and $2.23 per diluted share, respectively.

 

Basis of Reporting

 

The above data for both the three and six month periods ended June 30, 2017 and 2016 includes the results of our Washington, DC segment in (i) net income attributable to common shareholders, (ii) net income attributable to common shareholders, as adjusted, (iii) FFO and (iv) FFO, as adjusted.  The Washington, DC segment was spun off from Vornado Realty Trust on July 17, 2017.  Beginning in the third quarter of 2017, these results will be shown as discontinued operations and will not be included in net income attributable to common shareholders, as adjusted and FFO, as adjusted for all periods presented.

 

Supplemental Financial Information

 

Further details regarding results of operations, properties and tenants can be accessed at the Company’s website 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, as amended, for the year ended December 31, 2016.  Such factors include, among others, risks associated with the timing of and costs associated with property improvements, financing commitments and general competitive factors.

 

(tables to follow)

 
The following table reconciles our net income to net income, as adjusted (non-GAAP):

 

(Amounts in thousands, except per share amounts)

For the Three Months Ended

 

For the Six Months Ended

 

June 30,

 

June 30,

 

 

 

2017

 

2016

 

2017

 

2016

Net income attributable to common shareholders

$

115,972

 

$

220,463

 

$

163,724

 

$

106,300

 

Per diluted share

$

0.61

 

$

1.16

 

$

0.86

 

$

0.56

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certain items that impact net income attributable to

 

 

 

 

 

 

 

 

 

 

 

common shareholders:

 

 

 

 

 

 

 

 

 

 

 

 

Net gain on repayment of our Suffolk Downs JV debt investments

$

11,373

 

$

-

 

$

11,373

 

$

-

 

Acquisition and transaction related costs

 

(6,471)

 

 

(2,879)

 

 

(14,476)

 

 

(7,486)

 

Net income (loss) from discontinued operations and

 

 

 

 

 

 

 

 

 

 

 

 

 

sold properties

 

663

 

 

104

 

 

824

 

 

(1,325)

 

(Loss) income from real estate fund investments, net

 

(304)

 

 

7,544

 

 

(3,539)

 

 

12,855

 

Net gains on sale of real estate

 

-

 

 

161,721

 

 

2,267

 

 

161,721

 

Default interest on Skyline properties mortgage loan

 

-

 

 

(2,711)

 

 

-

 

 

(2,711)

 

Skyline properties impairment loss

 

-

 

 

-

 

 

-

 

 

(160,700)

 

Other

 

-

 

 

-

 

 

501

 

 

714

 

Our share of partially owned entities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain resulting from Urban Edge Properties ("UE")

 

 

 

 

 

 

 

 

 

 

 

 

 

operating partnership unit issuances

 

15,900

 

 

-

 

 

15,900

 

 

-

 

 

Net gains on sale of real estate

 

15,339

 

 

319

 

 

17,192

 

 

319

 

 

Real estate impairment losses

 

(167)

 

 

(49)

 

 

(3,218)

 

 

(4,402)

 

 

Other

 

(67)

 

 

(25)

 

 

(67)

 

 

(25)

 

 

 

 

36,266

 

 

164,024

 

 

26,757

 

 

(1,040)

Noncontrolling interests' share of above adjustments

 

(2,245)

 

 

(10,104)

 

 

(1,662)

 

 

91

Total of certain items that impact net income attributable to

 

 

 

 

 

 

 

 

 

 

 

common shareholders, net

$

34,021

 

$

153,920

 

$

25,095

 

$

(949)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to common shareholders,

 

 

 

 

 

 

 

 

 

 

 

 

as adjusted (non-GAAP)

$

81,951

 

$

66,543

 

$

138,629

 

$

107,249

 

Per diluted share (non-GAAP)

$

0.43

 

$

0.35

 

$

0.73

 

$

0.56

2

 
The following table reconciles our FFO (non-GAAP) to FFO, as adjusted (non-GAAP):



(Amounts in thousands, except per share amounts)

For the Three Months Ended

 

For the Six Months Ended

 

June 30,

 

June 30,

 

 

 

2017

 

2016

 

2017

 

2016

FFO (non-GAAP) (1)

$

257,673

 

$

229,432

 

$

463,422

 

$

433,104

 

Per diluted share (non-GAAP)

$

1.35

 

$

1.21

 

$

2.43

 

$

2.28

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Certain items that impact FFO:

 

 

 

 

 

 

 

 

 

 

 

 

Net gain on repayment of our Suffolk Downs JV debt investments

$

11,373

 

$

-

 

$

11,373

 

$

-

 

Acquisition and transaction related costs

 

(6,471)

 

 

(2,879)

 

 

(14,476)

 

 

(7,486)

 

FFO from discontinued operations and sold properties

 

663

 

 

2,889

 

 

824

 

 

6,349

 

(Loss) income from real estate fund investments, net

 

(304)

 

 

7,544

 

 

(3,539)

 

 

12,855

 

Default interest on Skyline properties mortgage loan

 

-

 

 

(2,711)

 

 

-

 

 

(2,711)

 

Other

 

-

 

 

-

 

 

501

 

 

714

 

Our share of partially owned entities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain resulting from UE operating partnership

 

 

 

 

 

 

 

 

 

 

 

 

 

unit issuances

 

15,900

 

 

-

 

 

15,900

 

 

-

 

 

Other

 

(67)

 

 

(25)

 

 

(67)

 

 

(25)

 

 

 

 

21,094

 

 

4,818

 

 

10,516

 

 

9,696

Noncontrolling interests' share of above adjustments

 

(1,306)

 

 

(400)

 

 

(653)

 

 

(594)

Total of certain items that impact FFO, net

$

19,788

 

$

4,418

 

$

9,863

 

$

9,102

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO, as adjusted (non-GAAP)

$

237,885

 

$

225,014

 

$

453,559

 

$

424,002

 

Per diluted share (non-GAAP)

$

1.25

 

$

1.19

 

$

2.38

 

$

2.23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

See page 5 for a reconciliation of our net income to FFO for the three and six months ended June 30, 2017 and 2016.

3

 
 
VORNADO REALTY TRUST

OPERATING RESULTS FOR THE THREE AND SIX MONTHS ENDED

JUNE 30, 2017 AND 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Amounts in thousands, except per share amounts)

For the Three Months Ended

 

For the Six Months Ended

 

June 30,

 

June 30,

 

 

 

 

2017

 

2016

 

2017

 

2016

Revenues

$

626,039

 

$

621,708

 

$

1,246,887

 

$

1,234,745

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

$

146,821

 

$

265,907

 

$

218,240

 

$

173,583

Income from discontinued operations

 

663

 

 

2,475

 

 

3,091

 

 

3,191

Net income

 

147,484

 

 

268,382

 

 

221,331

 

 

176,774

Less net income attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated subsidiaries

 

(7,677)

 

 

(13,025)

 

 

(14,414)

 

 

(22,703)

 

Operating Partnership

 

(7,706)

 

 

(14,531)

 

 

(10,935)

 

 

(7,044)

Net income attributable to Vornado

 

132,101

 

 

240,826

 

 

195,982

 

 

147,027

Preferred share dividends

 

(16,129)

 

 

(20,363)

 

 

(32,258)

 

 

(40,727)

Net income attributable to common shareholders

$

115,972

 

$

220,463

 

$

163,724

 

$

106,300

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income per common share - Basic:

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations, net

$

0.61

 

$

1.16

 

$

0.84

 

$

0.54

 

Income from discontinued operations, net

 

-

 

 

0.01

 

 

0.02

 

 

0.02

 

Net income per common share

$

0.61

 

$

1.17

 

$

0.86

 

$

0.56

 

Weighted average shares outstanding

 

189,395

 

 

188,772

 

 

189,304

 

 

188,715

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income per common share - Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations, net

$

0.61

 

$

1.15

 

$

0.84

 

$

0.54

 

Income from discontinued operations, net

 

-

 

 

0.01

 

 

0.02

 

 

0.02

 

Net income per common share

$

0.61

 

$

1.16

 

$

0.86

 

$

0.56

 

Weighted average shares outstanding

 

190,444

 

 

189,885

 

 

190,674

 

 

190,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO (non-GAAP)

$

257,673

 

$

229,432

 

$

463,422

 

$

433,104

 

Per diluted share (non-GAAP)

$

1.35

 

$

1.21

 

$

2.43

 

$

2.28

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO, as adjusted (non-GAAP)

$

237,885

 

$

225,014

 

$

453,559

 

$

424,002

 

Per diluted share (non-GAAP)

$

1.25

 

$

1.19

 

$

2.38

 

$

2.23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares used in determining FFO

 

 

 

 

 

 

 

 

 

 

 

 

per diluted share (non-GAAP)

 

190,444

 

 

189,885

 

 

190,450

 

 

190,043

4

 
 
The following table reconciles net income to FFO:

(Amounts in thousands, except per share amounts)

For the Three Months Ended

 

For the Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2017

 

2016

 

2017

 

2016

Net income attributable to common shareholders

$

115,972

 

$

220,463

 

$

163,724

 

$

106,300

 

Per diluted share

$

0.61

 

$

1.16

 

$

0.86

 

$

0.56

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO adjustments:

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization of real property

$

128,527

 

$

133,218

 

$

258,996

 

$

267,339

Net gains on sale of real estate

 

-

 

 

(161,721)

 

 

(2,267)

 

 

(161,721)

Real estate impairment losses

 

-

 

 

-

 

 

-

 

 

160,700

Proportionate share of adjustments to equity in net income (loss) of

 

 

 

 

 

 

 

 

 

 

 

 

partially owned entities to arrive at FFO:

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization of real property

 

37,682

 

 

38,308

 

 

76,756

 

 

77,354

 

 

Net gains on sale of real estate

 

(15,339)

 

 

(319)

 

 

(17,192)

 

 

(319)

 

 

Real estate impairment losses

 

167

 

 

49

 

 

3,218

 

 

4,402

 

 

 

 

151,037

 

 

9,535

 

 

319,511

 

 

347,755

Noncontrolling interests' share of above adjustments

 

(9,356)

 

 

(588)

 

 

(19,873)

 

 

(21,469)

FFO adjustments, net

$

141,681

 

$

8,947

 

$

299,638

 

$

326,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO attributable to common shareholders (non-GAAP)

$

257,653

 

$

229,410

 

$

463,362

 

$

432,586

Convertible preferred share dividends

 

20

 

 

22

 

 

60

 

 

43

Earnings allocated to Out-Performance Plan units

 

-

 

 

-

 

 

-

 

 

475

FFO attributable to common shareholders plus assumed

 

 

 

 

 

 

 

 

 

 

 

 

conversions (non-GAAP)

$

257,673

 

$

229,432

 

$

463,422

 

$

433,104

 

Per diluted share (non-GAAP)

$

1.35

 

$

1.21

 

$

2.43

 

$

2.28

 

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, real estate impairment losses, 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 non-GAAP financial measures 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 flow 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, as adjusted.  Although this non-GAAP measure clearly differs from NAREIT’s definition of FFO, we believe it provides a meaningful presentation of operating performance.  Reconciliations of FFO to FFO, as adjusted are provided on page 3 of this press release.

 

Conference Call and Audio Webcast

 

As previously announced, the Company will host a quarterly earnings conference call and an audio webcast on Tuesday, August 1, 2017 at 10:00 a.m. Eastern Time (ET).  The conference call can be accessed by dialing 800-708-4540 (domestic) or 847-619-6397 (international) and indicating to the operator the passcode 45172407.  A telephonic replay of the conference call will be available from 1:00 p.m. ET on August 1, 2017 through August 31, 2017.  To access the replay, please dial 888-843-7419 and enter the passcode 45172407#.  A live webcast of the conference call will be available on the Company’s website at www.vno.com and an online playback of the webcast will be available on the website for 90 days following the conference call.

 

 

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5