Colony NorthStar Announces Second Quarter 2017 Financial Results
Second Quarter 2017 Highlights
- Net income attributable to common stockholders of
$38.6 million , or$0.07 per basic share - Core FFO of
$203.6 million , or$0.35 per basic share, and FFO of$130.0 million , or$0.22 per basic share - Merger integration substantially complete and approximately 100% of the originally identified
$80 million annualized cash synergies target and 110% of the$115 million annualized total synergies target, which includes stock compensation savings, achieved to date on a run rate basis - Declared and paid a second quarter 2017 dividend of
$0.27 per share of Class A and B common stock- Subsequent to the second quarter 2017, declared a third quarter dividend of
$0.27 per share of Class A and B common stock
- Subsequent to the second quarter 2017, declared a third quarter dividend of
- The Company and its share of affiliates raised approximately
$285 million of third-party capital from institutional clients and retail investors for an aggregate$1.4 billion during the first half of 2017 - The Company completed year-to-date asset monetizations totaling
$3.6 billion of gross asset value, which includes$384 million in the second quarter primarily from selling the remainder of the Company’s interest inColony Starwood Homes (NYSE:SFR) and$437 million subsequent to the second quarter - The Company and funds managed by the Company invested and agreed to invest
$857 million ; the Company invested$670 million and funds managed by the Company invested$187 million - The Company has in excess of
$1.2 billion of liquidity through cash-on-hand and availability under its revolving credit facility - The Company repurchased 8.0 million shares of its common stock for
$102 million and year-to-date, repurchased an aggregate 12.9 million shares of its common stock for$168 million - The Company issued 13.8 million shares of 7.15% Series I cumulative redeemable perpetual preferred stock, generating net proceeds of
$334 million , and redeemed all of the shares of its 8.75% Series A cumulative redeemable perpetual preferred stock and 8.50% Series F cumulative redeemable perpetual preferred stock - The Company refinanced over
$1.6 billion of consolidated mortgage debt in theHospitality Real Estate segment, extending the maturity dates and reducing the interest rates, and repaid the remaining$77 million of the original$1.1 billion floating rate acquisition debt in theIndustrial Real Estate segment through the issuance of$188 million of long-term fixed rate mortgage loans
Second Quarter 2017 Financial Results
For the second quarter 2017,
For more information and a reconciliation of net income/(loss) to common stockholders to FFO, Core FFO, NOI and/or EBITDA, please refer to the non-GAAP financial measure definitions and tables at the end of this press release.
“We continue to make substantial progress in our transition via strategic divestitures and balance sheet repositioning including a potential contribution of a significant portion of our
Second Quarter 2017 Operating Results and Investment Activity by Segment
As of
During the second quarter 2017, this segment’s net loss attributable to common stockholders was
The following table presents NOI and certain operating metrics by property types in the Company’s
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Consolidated | CLNS OP | Same Store | ||||||||||||||||||||||||
NOI | Share NOI(1) | Consolidated NOI | Â | Occupancy %(2) | Â | TTM Coverage(3) | ||||||||||||||||||||
($ In millions) | Q2 2017 | Q2 2017 | Q2 2017 | Â | Q1 2017 | Q2 2017 | Â | Q1 2017 | |
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Medical Office Buildings | $ | 14.4 | $ | 10.3 | $ | 14.4 | Â | $ | 13.6 | 84.0 | % | Â | 85.1 | % | N/A | Â | N/A | |||||||||
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19.4 | 13.8 | 19.4 | 18.3 | 86.7 | % | 86.8 | % | N/A | N/A | ||||||||||||||||
Triple- |
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14.4 | 10.3 | 14.4 | 13.5 | 83.6 | % | 85.7 | % | 1.5x | 1.5x | ||||||||||||||||
Skilled Nursing Facilities | 24.9 | 17.8 | 24.9 | 28.5 | 83.4 | % | 84.2 | % | 1.3x | 1.4x | ||||||||||||||||
Hospitals | 5.4 | Â | 3.9 | Â | 5.4 | Â | Â | 5.4 | Â | 63.4 | % | Â | 60.9 | % | 3.3x | Â | 3.7x | |||||||||
Healthcare Total/W.A. | $ | 78.5 | Â | $ | 56.1 | Â | $ | 78.5 | Â | Â | $ | 79.3 | Â | 83.0 | % | Â | 83.6 | % | 1.6x | Â | 1.7x |
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(1) |  | CLNS OP Share NOI represents second quarter 2017 Consolidated NOI multiplied by CLNS OP’s ownership interest as of |
(2) | Occupancy % for |
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(3) | Represents the ratio of EBITDAR to cash rent on a trailing twelve month basis. | |
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As of
During the second quarter 2017, this segment’s net income attributable to common stockholders was
The following table presents NOI and certain operating metrics in the Company’s
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Consolidated | CLNS OP | Same Store | ||||||||||||||||||||
NOI |
Share NOI (1) |
Consolidated NOI | Â | Leased %(2) | ||||||||||||||||||
($ In millions) | Q2 2017 | Q2 2017 | Q2 2017 | Â | Q1 2017 | Q2 2017 | Â | Q1 2017 | ||||||||||||||
Industrial | $ | 38.5 | $ | 15.8 | $ | 37.0 | Â | $ |
36.4 |
95.6 | % | Â |
95.9 |
% |
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(1) |  | CLNS OP Share NOI represents second quarter 2017 Consolidated NOI multiplied by CLNS OP’s ownership interest as of |
(2) | Leased % represents the last day of the presented quarter. | |
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Asset Acquisitions, Dispositions and Financing
During the second quarter 2017, the Company acquired ten industrial buildings totaling approximately 1.6 million square feet for approximately
Subsequent to the second quarter 2017, the Company acquired 20 industrial buildings totaling approximately 2.8 million square feet for approximately
During the second quarter 2017, the Company paid off the remaining
As of
During the second quarter 2017, this segment’s net income attributable to common stockholders was
The following table presents EBITDA and certain operating metrics by brands in the Company’s
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Same Store | |||||||||||||||||||||||||||||||||||||
Consolidated | CLNS OP Share | Â | Â | Â | Â | Avg. Daily Rate | Â | RevPAR | |||||||||||||||||||||||||||||
Consolidated | |||||||||||||||||||||||||||||||||||||
EBITDA (1) |
EBITDA(2) |
EBITDA |
Occupancy %(3) |
(In dollars)(3) |
(In dollars)(3) |
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($ In millions) | Q2 2017 | Q2 2017 | Q2 2017 | Â | Q2 2016 | Q2 2017 | Â | Q2 2016 | Q2 2017 | Â | Q2 2016 | Q2 2017 | Â | Q2 2016 | |||||||||||||||||||||||
Marriott | $ | 62.8 | $ | 59.2 | $ | 62.8 | Â | $ | 65.5 | 77.0 | % | Â | 78.8 | % | $ | 129 | Â | $ | 128 | $ | 99 | Â | $ | 101 | |||||||||||||
Hilton | 13.9 | 13.1 | 13.9 | 13.0 | 82.0 | % | 81.5 | % | 131 | 127 | 108 | 103 | |||||||||||||||||||||||||
Other | 5.0 | Â | 4.7 | Â | 5.0 | Â | Â | 4.6 | Â | 84.2 | % | Â | 77.9 | % | 139 | Â | Â | 142 | Â | 117 | Â | Â | 110 | ||||||||||||||
Total/W.A. | $ | 81.7 | Â | $ | 77.0 | Â | $ | 81.7 | Â | Â | $ | 83.1 | Â | 78.2 | % | Â | 79.2 | % | $ | 130 | Â | Â | $ | 129 | Â | $ | 102 | Â | Â | $ | 102 |
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(1) | Â | Q2 2017 Consolidated EBITDA excludes FF&E reserve amounts of |
(2) | CLNS OP Share EBITDA represents second quarter 2017 Consolidated EBITDA multiplied by CLNS OP’s ownership interest as of |
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(3) | For each metric, data represents average during the presented quarter. | |
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Asset Financing
During the second quarter 2017, the Company refinanced over
Other Equity and Debt
In addition to the aforementioned real estate equity segments, the Company also holds investments in other real estate equity and debt. These other investments include direct interests and interests held through unconsolidated joint ventures in net lease real estate assets; other real estate equity & debt investments; limited partnership interests in third-party sponsored real estate private equity funds; and multiple classes of commercial real estate (“CRE”) securities. During the second quarter 2017, this segment’s aggregate net income attributable to common stockholders was
The following table presents undepreciated carrying value by investment type in the Company’s Other Equity and Debt segment:
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CLNS OP Share | ||||||
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Undepreciated Carrying Value | ||||||
($ In millions) | Assets | Â | Equity | |||
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$ | 961 | $ | 405 | ||
Other Real Estate Equity |
1,531 |
853 |
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Real Estate Debt |
2,996 |
2,148 |
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542 | 542 | ||||
Special Situations (NRE, CAF, Albertsons and Other GP Co-investments) |
222 | 222 | ||||
Other Equity and Debt Total | $ | 6,252 | $ | 4,170 | ||
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Other Equity and Debt Segment Asset Acquisitions and Dispositions
During the second quarter 2017, the Company invested and agreed to invest approximately
During the second quarter 2017, the Company sold its entire remaining interest in SFR, or approximately 7.6 million shares, resulting in net proceeds of
Subsequent to the second quarter 2017, the Company sold a portfolio of net lease properties located in
On
Investment Management
The Company’s Investment Management segment includes the business and operations of managing capital on behalf of third-party investors through closed and open-end funds, non-traded and traded real estate investment trusts and registered investment companies. As of
Capital Raising and Investment Activity
During the second quarter 2017, the Company and its share of affiliates raised approximately
During the second quarter 2017, institutional funds and retail companies managed by the Company, excluding the industrial open-end fund, invested and agreed to invest approximately
Assets Under Management (“AUM”)
As of
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% of | ||||||
($ In billions) | Amount | Grand Total | ||||
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Balance Sheet (CLNS OP Share): | ||||||
Healthcare | $ | 4.1 | 7.4 | % | ||
Industrial | 1.1 | 2.0 | % | |||
Hospitality | 3.9 | 7.0 | % | |||
Other Equity and Debt | 6.3 | 11.2 | % | |||
Balance Sheet Subtotal | 15.4 | 27.6 | % | |||
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Investment Management: | ||||||
Institutional Funds | 10.0 | 18.0 | % | |||
Retail Companies | 6.9 | 12.4 | % | |||
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2.1 | 3.8 | % | |||
Townsend | 14.2 | 25.5 | % | |||
Pro Rata Corporate Investments | 7.1 | 12.7 | % | |||
Investment Management Subtotal | 40.3 | 72.4 | % | |||
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Grand Total | $ | 55.7 | 100.0 | % | ||
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Liquidity and Financing
As of
On
Common Stock and Operating Company Units
As of
During the second quarter 2017, the Company repurchased 8.0 million shares of its common stock for
Common and Preferred Dividends
On
On
Non-GAAP Financial Measures and Definitions
Assets Under Management (“AUM”)
Refers to assets which the Company and its affiliates provide investment management services, including assets for which the Company may or may not charge management fees and/or performance allocations. AUM is generally based on reported gross undepreciated carrying value of managed investments as reported by each underlying vehicle at
Funds From Operations (“FFO”) and Core Funds From Operations (“Core FFO”)
The Company calculates funds from operations ("FFO") in accordance with standards established by the
The Company computes core funds from operations ("Core FFO") by adjusting FFO for the following items, including the Company’s share of these items recognized by its unconsolidated partnerships and joint ventures: (i) gains and losses from sales of depreciable real estate within the Other Equity and Debt segment, net of depreciation, amortization and impairment previously adjusted for FFO; (ii) equity-based compensation expense; (iii) effects of straight-line rent revenue and straight-line rent expense on ground leases; (iv) amortization of acquired above- and below-market lease values; (v) amortization of deferred financing costs and debt premiums and discounts; (vi) unrealized fair value gains or losses and foreign currency remeasurements; (vii) acquisition-related expenses, merger and integration costs; (viii) amortization and impairment of finite-lived intangibles related to investment management contracts and customer relationships; (ix) gain on remeasurement of consolidated investment entities and the effect of amortization thereof; (x) non-real estate depreciation and amortization; (xi) change in fair value of contingent consideration; and (xii) tax effect on certain of the foregoing adjustments. Also, beginning with the first quarter of 2016, the Company’s share of Core FFO from its interest in SFR represented its percentage interest multiplied by SFR's reported Core FFO, which may differ from the Company’s calculation of Core FFO. Refer to SFR's filings for its definition and calculation of Core FFO.
FFO and Core FFO should not be considered alternatives to GAAP net income as indications of operating performance, or to cash flows from operating activities as measures of liquidity, nor as indications of the availability of funds for our cash needs, including funds available to make distributions. FFO and Core FFO should not be used as supplements to or substitutes for cash flow from operating activities computed in accordance with GAAP. The Company’s calculations of FFO and Core FFO may differ from methodologies utilized by other REITs for similar performance measurements, and, accordingly, may not be comparable to those of other REITs.
The Company uses FFO and Core FFO as supplemental performance measures because, in excluding real estate depreciation and amortization and gains and losses from property dispositions, it provides a performance measure that captures trends in occupancy rates, rental rates, and operating costs. The Company also believes that, as widely recognized measures of the performance of REITs, FFO and Core FFO will be used by investors as a basis to compare its operating performance with that of other REITs. However, because FFO and Core FFO exclude depreciation and amortization and capture neither the changes in the value of the Company’s properties that resulted from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of its properties, all of which have real economic effect and could materially impact the Company’s results from operations, the utility of FFO and Core FFO as measures of the Company’s performance is limited. FFO and Core FFO should be considered only as supplements to net income as a measure of the Company’s performance.
Net Operating Income (“NOI”) / Earnings Before Interest, Tax, Depreciation and Amortization (“EBITDA”)
NOI for healthcare and industrial segments represents total property and related income less property operating expenses, adjusted for the effects of (i) straight-line rental income adjustments; (ii) amortization of acquired above- and below-market lease adjustments to rental income; and (iii) other items such as adjustments for the Company’s share of NOI of unconsolidated ventures.
EBITDA for the hospitality real estate segment represents net income from continuing operations of that segment excluding the impact of interest expense, income tax expense or benefit, and depreciation and amortization.
The Company believes that NOI and EBITDA are useful measures of operating performance of its respective real estate portfolios as they are more closely linked to the direct results of operations at the property level. NOI also reflects actual rents received during the period after adjusting for the effects of straight-line rents and amortization of above- and below- market leases; therefore, a comparison of NOI across periods better reflects the trend in occupancy rates and rental rates of the Company’s properties.
NOI and EBITDA exclude historical cost depreciation and amortization, which are based on different useful life estimates depending on the age of the properties, as well as adjust for the effects of real estate impairment and gains or losses on sales of depreciated properties, which eliminate differences arising from investment and disposition decisions. This allows for comparability of operating performance of the Company’s properties period over period and also against the results of other equity REITs in the same sectors. Additionally, by excluding corporate level expenses or benefits such as interest expense, any gain or loss on early extinguishment of debt and income taxes, which are incurred by the parent entity and are not directly linked to the operating performance of the Company’s properties, NOI and EBITDA provide a measure of operating performance independent of the Company’s capital structure and indebtedness.
However, the exclusion of these items as well as others, such as capital expenditures and leasing costs, which are necessary to maintain the operating performance of the Company’s properties, and transaction costs and administrative costs, may limit the usefulness of NOI and EBITDA. NOI may fail to capture significant trends in these components of
NOI should not be considered as an alternative to net income (loss), determined in accordance with
Second Quarter 2017 Conference Call
The Company will conduct a conference call to discuss the financial results on
For those unable to participate during the live call, a replay will be available starting
Supplemental Financial Report
A Second Quarter 2017 Supplemental Financial Report is available on the Company’s website at www.clns.com. This information has also been furnished to the
About
Cautionary Statement Regarding Forward-Looking Statements
This press release may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions.
Forward-looking statements involve known and unknown risks, uncertainties, assumptions and contingencies, many of which are beyond the Company’s control, and may cause the Company’s actual results to differ significantly from those expressed in any forward-looking statement. Factors that might cause such a difference include, without limitation, our failure to achieve anticipated synergies in and benefits of the completed merger among
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CONSOLIDATED BALANCE SHEETS | ||||||||
(In thousands, except per share data) | ||||||||
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(Unaudited) | 2016 | |||||||
Assets | ||||||||
Cash and cash equivalents | $ | 599,920 | $ | 376,005 | ||||
Restricted cash | 300,680 | 111,959 | ||||||
Real estate, net | 13,884,204 | 3,243,631 | ||||||
Loans receivable, net | 4,009,089 | 3,430,608 | ||||||
Investments in unconsolidated ventures ( |
1,526,807 | 1,052,995 | ||||||
Securities available for sale, at fair value | 409,871 | 23,446 | ||||||
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1,808,393 | 680,127 | ||||||
Deferred leasing costs and intangible assets, net | 1,035,767 | 278,741 | ||||||
Assets held for sale ( |
1,190,122 | 292,924 | ||||||
Other assets ( |
459,702 | 260,585 | ||||||
Due from affiliates | 63,777 | Â | 9,971 | Â | ||||
Total assets | $ | 25,288,332 | Â | $ | 9,760,992 | Â | ||
Liabilities | ||||||||
Debt, net | $ | 10,418,978 | $ | 3,715,618 | ||||
Accrued and other liabilities ( |
968,868 | 286,952 | ||||||
Intangible liabilities, net | 221,853 | 19,977 | ||||||
Liabilities related to assets held for sale | 203,548 | 14,296 | ||||||
Due to affiliates | 34,945 | 41,250 | ||||||
Dividends and distributions payable | 186,990 | Â | 65,972 | Â | ||||
Total liabilities | 12,035,182 | Â | 4,144,065 | Â | ||||
Commitments and contingencies | ||||||||
Redeemable noncontrolling interests | 79,504 | — | ||||||
Equity | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, |
1,624,444 | 607,200 | ||||||
Common stock, |
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Class A, 949,000 and 658,369 shares authorized; 551,190 and 166,440 shares issued and outstanding (1) | 5,512 | 1,664 | ||||||
Class B, 1,000 shares authorized; 742 and 770 shares issued and outstanding (1) | 7 | 8 | ||||||
Additional paid-in capital | 7,958,872 | 2,443,100 | ||||||
Distributions in excess of earnings | (505,554 | ) | (246,064 | ) | ||||
Accumulated other comprehensive income (loss) | 6,884 | Â | (32,109 | ) | ||||
Total stockholders’ equity | 9,090,165 | 2,773,799 | ||||||
Noncontrolling interests in investment entities | 3,643,836 | 2,453,938 | ||||||
Noncontrolling interests in |
439,645 | Â | 389,190 | Â | ||||
Total equity | 13,173,646 | Â | 5,616,927 | Â | ||||
Total liabilities, redeemable noncontrolling interests and equity | $ | 25,288,332 | Â | $ | 9,760,992 | Â |
__________
(1) | Â | As a result of the Merger, each outstanding share of common stock of Colony Capital, Inc. was exchanged for the right to receive 1.4663 of Class A common stock of |
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CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(In thousands, except per share data) | ||||||||
(Unaudited) | ||||||||
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 | Three Months Ended |
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2017 | Â | 2016 | ||||||
Revenues | ||||||||
Property operating income | $ | 500,531 | $ | 95,348 | ||||
Interest income | 111,263 | 103,860 | ||||||
Fee income | 54,319 | 15,505 | ||||||
Other income | 13,259 | Â | 2,815 | Â | ||||
Total revenues | 679,372 | Â | 217,528 | Â | ||||
Expenses | ||||||||
Property operating expense | 253,717 | 29,780 | ||||||
Interest expense | 140,260 | 42,568 | ||||||
Investment, servicing and commission expense | 13,740 | 5,402 | ||||||
Transaction costs | 2,440 | 7,958 | ||||||
Depreciation and amortization | 153,111 | 39,541 | ||||||
Provision for loan loss | 1,067 | 6,213 | ||||||
Impairment loss | 12,761 | 2,441 | ||||||
Compensation expense | 80,759 | 24,240 | ||||||
Administrative expenses | 30,145 | Â | 13,098 | Â | ||||
Total expenses | 688,000 | Â | 171,241 | Â | ||||
Other income | ||||||||
Gain on sale of real estate assets | 15,190 | 5,844 | ||||||
Other loss, net | (23,850 | ) | (348 | ) | ||||
Earnings from investments in unconsolidated ventures | 122,394 | Â | 53,113 | Â | ||||
Income before income taxes | 105,106 | 104,896 | ||||||
Income tax benefit (expense) | 86 | Â | (1,760 | ) | ||||
Net income from continuing operations | 105,192 | 103,136 | ||||||
Income from discontinued operations | — |  | — |  | ||||
Net income | 105,192 | 103,136 | ||||||
Net income attributable to noncontrolling interests: | ||||||||
Redeemable noncontrolling interests | 720 | — | ||||||
Investment entities | 23,800 | 40,169 | ||||||
Operating Company | 2,330 | Â | 7,918 | Â | ||||
Net income attributable to |
78,342 | 55,049 | ||||||
Preferred stock redemption | 5,448 | — | ||||||
Preferred stock dividends | 34,339 | Â | 12,093 | Â | ||||
Net income attributable to common stockholders | $ | 38,555 | Â | $ | 42,956 | Â | ||
Basic earnings per share (1) | ||||||||
Net income from continuing operations per basic common share | $ | 0.07 | Â | $ | 0.26 | Â | ||
Net income per basic common share | $ | 0.07 | Â | $ | 0.26 | Â | ||
Diluted earnings per share (1) | ||||||||
Net income from continuing operations per diluted common share | $ | 0.07 | Â | $ | 0.24 | Â | ||
Net income per diluted common share | $ | 0.07 | Â | $ | 0.24 | Â | ||
Weighted average number of shares (1) | ||||||||
Basic | 544,023 | Â | 164,674 | Â | ||||
Diluted | 544,023 | Â | 201,257 | Â |
__________
(1) | Â | As a result of the Merger, each outstanding share of common stock of Colony Capital, Inc. was exchanged for the right to receive 1.4663 of Class A common stock of |
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FUNDS FROM OPERATIONS AND CORE FUNDS FROM OPERATIONS | ||||
(In thousands, except per share data) | ||||
(Unaudited) | ||||
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 | Three Months Ended | |||
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Net loss attributable to common stockholders | $ | 38,555 | ||
Adjustments for FFO attributable to common interests in |
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Net loss attributable to noncontrolling common interests in |
2,330 | |||
Real estate depreciation and amortization | 135,421 | |||
Impairment of real estate | 12,816 | |||
Gain on sales of real estate | (15,112 | ) | ||
Less: Adjustments attributable to noncontrolling interests in investment entities | (44,048 | ) | ||
FFO attributable to common interests in |
129,962 | Â | ||
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Additional adjustments for Core FFO attributable to common interests in |
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Gain on sales of real estate, net of depreciation, amortization and impairment previously adjusted for FFO (1) | (31,183 | ) | ||
Noncash equity compensation expense (2) | 38,945 | |||
Straight-line rent revenue | (7,994 | ) | ||
Gain on change in fair value of contingent consideration | (4,850 | ) | ||
Amortization of acquired above- and below-market lease intangibles, net | (3,520 | ) | ||
Amortization of deferred financing costs and debt premiums and discounts | 20,791 | |||
Unrealized loss on derivatives and foreign currency remeasurements | 26,834 | |||
Acquisition and merger-related transaction costs | 2,498 | |||
Merger integration costs (3) | 7,555 | |||
Preferred shares redemption costs | 5,448 | |||
Amortization and impairment of investment management intangibles | 15,666 | |||
Non-real estate depreciation and amortization | 6,482 | |||
Amortization of gain on remeasurement of consolidated investment entities, net | 3,837 | |||
Tax benefit, net (4) |
(809 | ) | ||
Less: Adjustments attributable to noncontrolling interests in investment entities | (6,074 | ) | ||
Core FFO attributable to common interests in |
$ | 203,588 | Â | |
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FFO per common share / common OP unit (5) |
$ | 0.22 | Â | |
FFO per common share / common OP unit—diluted (6) |
$ | 0.22 | Â | |
Core FFO per common share / common OP unit (5) |
$ | 0.35 | Â | |
Core FFO per common share / common OP unit—diluted (6) | $ | 0.34 |  | |
Weighted average number of common OP units outstanding used for FFO and Core FFO per common share and OP unit (5) |
585,110 | Â | ||
Weighted average number of common OP units outstanding used for FFO and Core FFO per common share and OP unit—diluted (5)(6) |
623,455 | Â |
__________
(1) | Â | Includes |
(2) | Includes |
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(3) | Merger integration costs represent costs and charges incurred during the integration of Colony, NSAM and NRF. These integration costs are not reflective of the Company’s core operating performance and the Company does not expect to incur these costs subsequent to the completion of the merger integration. The majority of integration costs consist of severance, employee costs of those separated or scheduled for separation, system integration and lease terminations. | |
(4) | Adjustment represents the impact of taxes on amortization and impairment of investment management intangibles assumed in business combinations and gain on sale of property. | |
(5) | Calculated based on weighted average shares outstanding including participating securities (unvested shares) and assuming the exchange of all common OP units outstanding for common shares. As a result of the Merger, each outstanding share of common stock of Colony Capital, Inc. was exchanged for the right to receive 1.4663 of Class A common stock of |
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(6) | For the three months ended |
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RECONCILIATION OF NET INCOME (LOSS) TO NOI/EBITDA
The following tables present: (1) a reconciliation of property and other related revenues less property operating expenses for properties in our Healthcare, Industrial, and Hospitality segments to NOI or EBITDA and (2) a reconciliation of such segments net income (loss) for the three months ended
NOI and EBITDA were determined as follows:
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Three Months Ended |
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(In thousands) |
Healthcare | Â | Industrial | Â | Hospitality | |||||||
Total revenues | $ | 159,357 | $ | 56,125 | $ | 221,522 | ||||||
Straight-line rent revenue and amortization of above- and below-market lease intangibles | (8,385 | ) | (1,150 | ) | (13 | ) | ||||||
Property operating expenses (1) | (72,460 | ) | (16,195 | ) | (139,818 | ) | ||||||
Compensation expense (1) | — |  | (310 | ) | — |  | ||||||
NOI or EBITDA | $ | 78,512 | Â | $ | 38,470 | Â | $ | 81,691 | Â |
_________
(1) | Â | For healthcare and hospitality, property operating expenses includes property management fees paid to third parties. For industrial, there are direct costs of managing the portfolio which are included in compensation expense. |
 |
The following table presents a reconciliation of net income (loss) from continuing operations of the healthcare, industrial and hospitality segments to NOI or EBITDA of the respective segments.
 | Three Months Ended |
|||||||||||
(In thousands) | Healthcare | Â | Industrial | Â | Hospitality | |||||||
Net income (loss) from continuing operations | $ | (11,394 | ) | $ | 9,100 | $ | 5,750 | |||||
Adjustments: | ||||||||||||
Straight-line rent revenue and amortization of above- and below-market lease intangibles | (8,385 | ) | (1,150 | ) | (13 | ) | ||||||
Interest expense | 47,844 | 7,934 | 35,884 | |||||||||
Transaction, investment and servicing costs | 1,566 | 26 | 3,049 | |||||||||
Depreciation and amortization | 49,577 | 25,804 | 33,508 | |||||||||
Compensation and administrative expense | 2,003 | 2,733 | 2,385 | |||||||||
Gain on sale of real estate assets | — | (8,695 | ) | — | ||||||||
Other (gain) loss, net | (2,489 | ) | — | 219 | ||||||||
Earnings from investments in unconsolidated ventures | — | (28 | ) | — | ||||||||
Income tax (benefit) expense | (210 | ) | 2,746 | Â | 909 | Â | ||||||
NOI or EBITDA | $ | 78,512 | Â | $ | 38,470 | Â | $ | 81,691 | Â |
The following table summarizes Q2 2017 net income (loss) from continuing operations by segment:
 |  |  |  |  | ||||
Net income (Loss) | ||||||||
From Continuing | ||||||||
(In thousands) |
Operations | |||||||
Healthcare | $ | (11,394 | ) | |||||
Industrial | 9,100 | |||||||
Hospitality | 5,750 | |||||||
Other Equity and Debt | 185,630 | |||||||
Investment Management | 26,084 | |||||||
Amounts Not Allocated to Segments | (109,978 | ) | ||||||
Total Consolidated | $ | 105,192 | Â | |||||
 |
View source version on businesswire.com: http://www.businesswire.com/news/home/20170808006469/en/
Investor Contacts:
Darren J. Tangen
Executive Vice President and Chief Financial Officer
310-552-7230
or
Addo Investor Relations
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