May 10, 2019 at 7:00 AM EDT
First Quarter 2019 Financial Results and Highlights
For more information and a reconciliation of net income/(loss) to common stockholders to Core FFO and/or NOI, please refer to the non-GAAP financial measure definitions and tables at the end of this press release.
First Quarter 2019 Operating Results and Investment Activity by Segment
As of
During the first quarter 2019, 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
| Consolidated | CLNY OP | Same Store | ||||||||||||||||||||||||||||||||||
| NOI | Share NOI(1) | Consolidated NOI | Occupancy %(2) |
TTM Lease Coverage(3) |
||||||||||||||||||||||||||||||||
| ($ in millions) | Q1 2019 | Q1 2019 | Q1 2019 | Q4 2018 | Q1 2019 | Q4 2018 | 12/31/18 | 9/30/18 | ||||||||||||||||||||||||||||
| Senior Housing - Operating | $ | 17.3 | $ | 12.3 | $ | 17.3 | $ | 15.7 | 86.7 | % | 86.8 | % | N/A | N/A | ||||||||||||||||||||||
| Medical Office Buildings (MOB) | 12.4 | 8.8 | 12.4 | 12.6 | 82.4 | % | 82.3 | % | N/A | N/A | ||||||||||||||||||||||||||
| Triple-Net Lease: | ||||||||||||||||||||||||||||||||||||
| Senior Housing | 15.4 | 10.9 | 15.4 | 15.3 | 82.1 | % | 82.1 | % | 1.3x | 1.4x | ||||||||||||||||||||||||||
| Skilled Nursing Facilities | 25.7 | 18.3 | 25.7 | 25.8 | 82.4 | % | 82.4 | % | 1.2x | 1.2x | ||||||||||||||||||||||||||
| Hospitals | 5.4 | 3.8 | 5.4 | 4.8 | 58.5 | % | 58.1 | % | 2.3x |
3.4x |
|
(4) |
||||||||||||||||||||||||
| Healthcare Total | $ | 76.2 | $ | 54.1 | $ | 76.2 | $ | 74.2 | ||||||||||||||||||||||||||||
_____________________________________
| (1) | CLNY OP Share NOI represents first quarter 2019 Consolidated NOI multiplied by CLNY OP’s ownership interest as of March 31, 2019. | |
| (2) |
Occupancy % for Senior Housing - Operating represents average during the presented quarter, for MOBs represents as of last day in the quarter and for other types represents average during the prior quarter. |
|
| (3) | Represents the ratio of the tenant’s/operator’s EBITDAR to cash rent payable to the Company’s Healthcare Real Estate segment on a trailing twelve month basis. | |
| (4) | September 30, 2018 TTM Lease Coverage included an extraordinary Hospital Quality Assurance Fee received by one of our hospital operators during the fourth quarter of 2017. |
Asset Financing
During the first quarter 2019, the Company refinanced two loans with an
aggregate consolidated balance of
Subsequent to the first quarter 2019, the Company refinanced a loan with
a consolidated balance of
The Company continues to evaluate options in connection with the
As of
As of
The Company owns a 100% interest in the related industrial operating platform, which manages both the light and bulk industrial assets.
During the first quarter 2019, this segment’s net income attributable to
common stockholders was
The following table presents NOI and certain operating metrics in the
Company’s
| Consolidated | CLNY OP | Same Store | |||||||||||||||||||||||||||||||
| NOI | Share NOI (1) | Consolidated NOI | Leased %(2) | ||||||||||||||||||||||||||||||
| ($ in millions) | Q1 2019 | Q1 2019 | Q1 2019 | Q4 2018 | 3/31/19 | 12/31/18 | |||||||||||||||||||||||||||
| Light Industrial(3) | $ | 54.6 | $ | 18.3 | $ | 41.8 | $ | 41.6 | 94.9 | % | 95.6 | % | |||||||||||||||||||||
| Bulk Industrial(3) | 1.2 | 0.6 | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||
| Total Industrial(3) | $ | 55.8 |
(3) |
|
$ | 18.9 |
(3) |
|
N/A | N/A | N/A | N/A | |||||||||||||||||||||
_____________________________________
| (1) | CLNY OP Share NOI represents first quarter 2019 Consolidated NOI multiplied by CLNY OP’s ownership interest as of March 31, 2019. | |
| (2) | Leased % as of the reported date represents square feet under executed leases, some of which may not have taken occupancy. | |
| (3) |
During the first quarter 2019, this segment’s NOI included partial quarter financial results related to the newly acquired portfolio of light and bulk industrial buildings for the period of February 27, 2019 to March 31, 2019. |
Asset Acquisitions, Dispositions and Financing
During the first quarter 2019, the light industrial platform acquired
three light industrial buildings totaling 0.7 million square feet and
one land parcel for development for
During the first quarter 2019, the light industrial platform disposed of
34 non-core light industrial buildings for
Subsequent to the first quarter 2019, the light industrial platform
acquired two land parcels for development for
As of
During the first quarter 2019, this segment’s net loss attributable to
common stockholders was
The following table presents NOI before FF&E Reserve and certain
operating metrics by brands in the Company’s
| Same Store | ||||||||||||||||||||||||||||||||||||||||||||||
| Consolidated | CLNY OP Share | Consolidated | Avg. Daily Rate | RevPAR(3) | ||||||||||||||||||||||||||||||||||||||||||
|
NOI before |
NOI before |
NOI before FF&E |
Occupancy %(4) | (In dollars)(4) | (In dollars)(4) | |||||||||||||||||||||||||||||||||||||||||
| ($ in millions) | Q1 2019 | Q1 2019 | Q1 2019 | Q1 2018 | Q1 2019 | Q1 2018 | Q1 2019 | Q1 2018 | Q1 2019 | Q1 2018 | ||||||||||||||||||||||||||||||||||||
| Marriott | $ | 47.2 | $ | 44.5 | $ | 47.2 | $ | 46.9 | 68.2 | % | 69.2 | % | $ | 130 | $ | 129 | $ | 89 | $ | 89 | ||||||||||||||||||||||||||
| Hilton | 9.9 | 9.3 | 9.9 | 8.7 | 73.3 | % | 73.8 | % | 126 | 124 | 93 | 91 | ||||||||||||||||||||||||||||||||||
| Other | 3.5 | 3.3 | 3.5 | 3.6 | 80.4 | % | 78.2 | % | 127 | 127 | 102 | 99 | ||||||||||||||||||||||||||||||||||
| Total/W.A. | $ | 60.6 | $ | 57.1 | $ | 60.6 | $ | 59.2 | 69.7 | % | 70.4 | % | $ | 129 | $ | 128 | $ | 90 | $ | 90 | ||||||||||||||||||||||||||
_____________________________________
| (1) | First quarter 2019 consolidated FF&E reserve was $8.7 million. | |
| (2) | CLNY OP Share NOI before FF&E Reserve represents first quarter 2019 Consolidated NOI before FF&E Reserve multiplied by CLNY OP’s ownership interest as of March 31, 2019. | |
| (3) | RevPAR, or revenue per available room, represents a hotel's total guestroom revenue divided by the room count and the number of days in the period being measured. | |
| (4) | For each metric, data represents average during the presented quarter. |
Asset Financing
During the first quarter 2019, the Company refinanced
Other Equity and Debt
The Company owns a diversified group of strategic and non-strategic real
estate and real estate-related debt and equity investments. Strategic
investments include our 11% interest in
As of
| CLNY OP Share | ||||||||||||||||||
| Undepreciated Carrying Value | ||||||||||||||||||
| March 31, 2019 | December 31, 2018 | |||||||||||||||||
| ($ in millions) | Assets | Equity | Assets | Equity | ||||||||||||||
|
Strategic: |
||||||||||||||||||
| GP co-investments | $ |
1,197 |
$ | 724 | $ | 1,075 | $ | 684 | ||||||||||
| Interest in NRE | 88 | 88 | 88 | 88 | ||||||||||||||
| Strategic Subtotal |
1,285 |
812 | 1,163 | 772 | ||||||||||||||
|
Non-Strategic: |
||||||||||||||||||
| Other Real Estate Equity & Albertsons | 1,372 | 704 | 1,481 | 752 | ||||||||||||||
| Real Estate Debt | 290 | 290 | 297 | 297 | ||||||||||||||
| Net Lease Real Estate Equity | 182 | 74 | 219 | 92 | ||||||||||||||
| CRE Securities and Real Estate Private Equity Funds | 70 | 70 | 70 | 70 | ||||||||||||||
| Non-Strategic Subtotal | 1,914 | 1,138 | 2,067 | 1,211 | ||||||||||||||
| Total Other Equity and Debt | $ |
3,199 |
$ | 1,950 | $ | 3,230 | $ | 1,983 | ||||||||||
Other Equity and Debt Segment Asset Dispositions
During the first quarter 2019, the Company sold or received payoffs in
aggregate of
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 private funds, and traded and non-traded
real estate investment trusts. As of
Subsequent to the first quarter 2019, the Company acquired the
Assets Under Management (“AUM”)
As of
| March 31, 2019 | December 31, 2018 | ||||||||||||||||
| ($ in billions) | Amount |
% of |
Amount |
% of |
|||||||||||||
| Balance Sheet (CLNY OP Share): | |||||||||||||||||
| Healthcare | $ | 3.9 | 9.0 | % | $ | 3.9 | 9.1 | % | |||||||||
| Industrial | 1.6 | 3.7 | % | 1.2 | 2.8 | % | |||||||||||
| Hospitality | 3.9 | 9.0 | % | 4.0 | 9.4 | % | |||||||||||
| Other Equity and Debt | 3.2 | 7.4 | % | 3.2 | 7.5 | % | |||||||||||
| CLNC(1) | 2.0 | 4.6 | % | 2.0 | 4.7 | % | |||||||||||
| Balance Sheet Subtotal | 14.6 | 33.7 | % | 14.3 | 33.5 | % | |||||||||||
| Investment Management: | |||||||||||||||||
| Institutional Funds | 9.9 | 22.7 | % | 9.5 | 22.2 | % | |||||||||||
| Retail Companies | 3.5 | 8.1 | % | 3.5 | 8.2 | % | |||||||||||
| Colony Credit Real Estate (NYSE:CLNC)(2) | 3.5 | 8.1 | % | 3.5 | 8.2 | % | |||||||||||
|
NorthStar Realty Europe (NYSE:NRE) (3) |
1.6 | 3.7 | % | 1.7 | 4.0 | % | |||||||||||
|
Non-Wholly Owned REIM Platforms(4) |
10.3 | 23.7 | % | 10.2 | 23.9 | % | |||||||||||
| Investment Management Subtotal | 28.8 | 66.3 | % | 28.4 | 66.5 | % | |||||||||||
| Grand Total | $ | 43.4 | 100.0 | % | $ | 42.7 | 100.0 | % | |||||||||
_____________________________________
| (1) | Represents the Company’s 36% and 37% ownership share of CLNC’s total pro-rata share of assets of $5.5 billion as of March 31, 2019 and December 31, 2018, respectively. | |
| (2) | Represents third-party 64% and 63% ownership share of CLNC’s total pro-rata share of assets of $5.5 billion as of March 31, 2019 and December 31, 2018, respectively. | |
|
(3) |
The Company entered into an agreement with NRE to terminate the management agreement. Upon termination, NRE will make a termination payment to the Company of $70 million, less any incentive fee paid by NRE to the Company through termination. |
|
|
(4) |
REIM: Real Estate Investment Management |
Liquidity and Financing
Subsequent to the first quarter 2019, the Company amended certain terms
of its corporate credit facility agreement including a reduction of
aggregate revolving commitments from
As of
In connection with the merger among
Common Stock and Operating Company Units
As of
During the first quarter 2019, the Company repurchased 652,311 shares of
its Class A common stock at an average price of
As of
Common and Preferred Dividends
On
On
Non-GAAP Financial Measures and Definitions
Assets Under Management (“AUM”)
Assets for 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 based
on reported gross undepreciated carrying value of managed investments as
reported by each underlying vehicle at
The operating partnership through which the Company conducts all of its activities and holds substantially all of its assets and liabilities. CLNY OP share excludes noncontrolling interests in investment entities.
Fee-Earning Equity Under Management (“FEEUM”)
Equity for which the Company and its affiliates provides investment
management services and derives management fees and/or performance
allocations. FEEUM generally represents a) the basis used to derive
fees, which may be based on invested equity, stockholders’ equity, or
fair value pursuant to the terms of each underlying investment
management agreement and b) the Company’s pro-rata share of fee bearing
equity of each affiliate as presented and calculated by the affiliate.
Affiliates include the co-sponsored digital real estate infrastructure
vehicle,
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 Board of Governors of 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) gains and
losses from sales of businesses within the Investment Management segment
and impairment write-downs associated with the Investment Management
segment; (iii) equity-based compensation expense; (iv) effects of
straight-line rent revenue and expense; (v) amortization of acquired
above- and below-market lease values; (vi) amortization of deferred
financing costs and debt premiums and discounts; (vii) unrealized fair
value gains or losses on interest rate and foreign currency hedges, and
foreign currency remeasurements; (viii) acquisition and merger related
transaction costs; (ix) merger integration and restructuring costs; (x)
amortization and impairment of finite-lived intangibles related to
investment management contracts and customer relationships; (xi) gain on
remeasurement of consolidated investment entities and the effect of
amortization thereof; (xii) non-real estate depreciation and
amortization; (xiii) change in fair value of contingent consideration;
and (xiv) tax effect on certain of the foregoing adjustments. Beginning
with the first quarter of 2018, the Company’s Core FFO from its interest
in
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 GAAP net income as a measure of the Company’s performance. Additionally, Core FFO excludes the impact of certain fair value fluctuations, which, if they were to be realized, could have a material impact on the Company’s operating performance. The Company also presents Core FFO excluding gains and losses from sales of certain investments as well as its share of similar adjustments for CLNC. The Company believes that such a measure is useful to investors as it excludes periodic gains and losses from sales of investments that are not representative of its ongoing operations.
Net Operating Income (“NOI”)
NOI for our real estate 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.
The Company believes that NOI is a useful measure of operating performance of its respective real estate portfolios as it is 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 excludes 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 provides 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. NOI may fail to capture significant trends in these components of U.S. GAAP net income (loss) which further limits its usefulness.
NOI should not be considered as an alternative to net income (loss), determined in accordance with U.S. GAAP, as an indicator of operating performance. In addition, the Company’s methodology for calculating NOI involves subjective judgment and discretion and may differ from the methodologies used by other comparable companies, including other REITs, when calculating the same or similar supplemental financial measures and may not be comparable with other companies.
NOI before Reserve for Furniture, Fixtures and Equipment Expenditures (“NOI before FF&E Reserve”)
For our hospitality real estate segment, NOI before FF&E Reserve represents NOI before the deduction of reserve contributions for the repair, replacement and refurbishment of furniture, fixtures, and equipment ("FF&E"), which are typically 4% to 5% of revenues, and required under certain debt agreements and/or franchise and brand-managed hotel agreements.
Earnings Before Interest, Tax, Depreciation, Amortization and Rent (“EBITDAR”)
Represents earnings before interest, taxes, depreciation, amortization
and rent for facilities accruing to the tenant/operator of the property
(not the Company) for the period presented. The Company uses EBITDAR in
determining TTM Lease Coverage for triple-net lease properties in its
TTM Lease Coverage
Represents the ratio of EBITDAR to recognized cash rent for owned facilities on a trailing twelve month basis. TTM Lease Coverage is a supplemental measure of a tenant’s/operator’s ability to meet their cash rent obligations to the Company. However, its usefulness is limited by, among other things, the same factors that limit the usefulness of EBITDAR.
The information related to the Company’s tenants/operators that is provided in this press release has been provided by, or derived from information provided by, such tenants/operators. The Company has not independently verified this information and has no reason to believe that such information is inaccurate in any material respect. The Company is providing this data for informational purposes only.
First Quarter 2019 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
Corporate Overview and Supplemental Financial Report
A First Quarter 2019 Corporate Overview and Supplemental Financial
Report is available on the Company’s website at www.clny.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 ability to achieve anticipated compensation and
administrative cost savings pursuant to our corporate restructuring and
reorganization plan, in the timeframe expected or at all, the impact of
changes to the Company’s management, employee and organizational
structure, whether the formation of the Strategic Asset Review Committee
will result in any action or transaction by the Company and whether the
Company, including its stockholders, will benefit from it, whether the
Company will realize any of the anticipated benefits of its acquisition
of
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COLONY CAPITAL, INC. |
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CONSOLIDATED BALANCE SHEETS |
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|
(In thousands, except per share data) |
|||||||||
|
March 31, 2019 |
December 31, 2018 | ||||||||
| Assets | |||||||||
| Cash and cash equivalents | $ | 321,199 | $ | 461,912 | |||||
| Restricted cash | 326,635 | 366,758 | |||||||
| Real estate, net | 14,536,041 | 13,619,014 | |||||||
| Loans receivable, net | 1,596,673 | 1,659,217 | |||||||
| Equity and debt investments | 2,769,616 | 2,543,169 | |||||||
| Goodwill | 1,534,561 | 1,534,561 | |||||||
| Deferred leasing costs and intangible assets, net | 546,903 | 540,264 | |||||||
| Assets held for sale | 786,467 | 941,258 | |||||||
| Other assets | 757,752 | 503,317 | |||||||
| Due from affiliates | 45,186 | 45,779 | |||||||
| Total assets | $ | 23,221,033 | $ | 22,215,249 | |||||
| Liabilities | |||||||||
| Debt, net | $ | 10,712,788 | $ | 10,039,957 | |||||
| Accrued and other liabilities | 1,037,166 | 707,921 | |||||||
| Intangible liabilities, net | 141,744 | 159,386 | |||||||
| Liabilities related to assets held for sale | 22,435 | 68,217 | |||||||
| Dividends and distributions payable | 83,996 | 84,013 | |||||||
| Total liabilities | 11,998,129 | 11,059,494 | |||||||
| Commitments and contingencies | |||||||||
| Redeemable noncontrolling interests | 7,463 | 9,385 | |||||||
| Equity | |||||||||
| Stockholders’ equity: | |||||||||
| Preferred stock, $0.01 par value per share; $1,436,605 liquidation preference; 250,000 shares authorized; 57,464 shares issued and outstanding | 1,407,495 | 1,407,495 | |||||||
| Common stock, $0.01 par value per share | |||||||||
| Class A, 949,000 shares authorized; 484,775 and 483,347 shares issued and outstanding, respectively | 4,848 | 4,834 | |||||||
| Class B, 1,000 shares authorized; 734 shares issued and outstanding | 7 | 7 | |||||||
| Additional paid-in capital | 7,610,947 | 7,598,019 | |||||||
| Distributions in excess of earnings | (2,176,730 | ) | (2,018,302 | ) | |||||
| Accumulated other comprehensive income | 22,138 | 13,999 | |||||||
| Total stockholders’ equity | 6,868,705 | 7,006,052 | |||||||
| Noncontrolling interests in investment entities | 3,996,206 | 3,779,728 | |||||||
| Noncontrolling interests in Operating Company | 350,530 | 360,590 | |||||||
| Total equity | 11,215,441 | 11,146,370 | |||||||
| Total liabilities, redeemable noncontrolling interests and equity | $ | 23,221,033 | $ | 22,215,249 | |||||
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COLONY CAPITAL, INC. |
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CONSOLIDATED STATEMENTS OF OPERATIONS |
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(In thousands, except per share data) |
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(unaudited) |
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| Three Months Ended March 31, | |||||||||
| 2019 | 2018 | ||||||||
| Revenues | |||||||||
| Property operating income | $ | 540,130 | $ | 554,730 | |||||
| Interest income | 46,250 | 63,854 | |||||||
| Fee income | 33,500 | 36,842 | |||||||
| Other income | 13,023 | 11,238 | |||||||
| Total revenues | 632,903 | 666,664 | |||||||
| Expenses | |||||||||
| Property operating expense | 293,079 | 305,770 | |||||||
| Interest expense | 149,516 | 148,889 | |||||||
| Investment and servicing expense | 18,979 | 18,653 | |||||||
| Transaction costs | 2,504 | 716 | |||||||
| Placement fees | 309 | 123 | |||||||
| Depreciation and amortization | 150,797 | 144,705 | |||||||
| Provision for loan loss | 3,611 | 5,375 | |||||||
| Impairment loss | 25,622 | 153,398 | |||||||
| Compensation expense | |||||||||
| Cash and equity-based compensation | 34,176 | 49,484 | |||||||
| Carried interest and incentive fee compensation | 1,051 | 859 | |||||||
| Administrative expenses | 24,014 | 24,740 | |||||||
| Total expenses | 703,658 | 852,712 | |||||||
| Other income (loss) | |||||||||
| Gain on sale of real estate assets | 52,301 | 18,444 | |||||||
| Other gain (loss), net | (49,077 | ) | 75,256 | ||||||
| Equity method earnings | 34,065 | 30,117 | |||||||
| Equity method earnings—carried interest | 4,422 | 2,148 | |||||||
| Loss before income taxes | (29,044 | ) | (60,083 | ) | |||||
| Income tax benefit (expense) | (1,111 | ) | 32,808 | ||||||
| Loss from continuing operations | (30,155 | ) | (27,275 | ) | |||||
| Income from discontinued operations | — | 117 | |||||||
| Net loss | (30,155 | ) | (27,158 | ) | |||||
| Net income (loss) attributable to noncontrolling interests: | |||||||||
| Redeemable noncontrolling interests | 1,444 | (696 | ) | ||||||
| Investment entities | 49,988 | 19,243 | |||||||
| Operating Company | (6,611 | ) | (4,378 | ) | |||||
| Net loss attributable to Colony Capital, Inc. | (74,976 | ) | (41,327 | ) | |||||
| Preferred stock dividends | 27,137 | 31,387 | |||||||
| Net loss attributable to common stockholders | $ | (102,113 | ) | $ | (72,714 | ) | |||
| Basic loss per share | |||||||||
| Loss from continuing operations per basic common share | $ | (0.21 | ) | $ | (0.14 | ) | |||
| Net loss per basic common share | $ | (0.21 | ) | $ | (0.14 | ) | |||
| Diluted loss per share | |||||||||
| Loss from continuing operations per diluted common share | $ | (0.21 | ) | $ | (0.14 | ) | |||
| Net loss per diluted common share | $ | (0.21 | ) | $ | (0.14 | ) | |||
| Weighted average number of shares | |||||||||
| Basic | 478,874 | 530,680 | |||||||
| Diluted | 478,874 | 530,680 | |||||||
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COLONY CAPITAL, INC. |
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FUNDS FROM OPERATIONS AND CORE FUNDS FROM OPERATIONS |
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(In thousands, except per share data) |
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(Unaudited) |
|||||
|
Three Months Ended |
|||||
| Net loss attributable to common stockholders | $ | (102,113 | ) | ||
| Adjustments for FFO attributable to common interests in Operating Company and common stockholders: | |||||
| Net loss attributable to noncontrolling common interests in Operating Company | (6,611 | ) | |||
| Real estate depreciation and amortization | 154,402 | ||||
| Impairment of real estate | 25,622 | ||||
| Gain from sales of real estate | (55,234 | ) | |||
| Less: Adjustments attributable to noncontrolling interests in investment entities | (35,274 | ) | |||
| FFO attributable to common interests in Operating Company and common stockholders | (19,208 | ) | |||
| Additional adjustments for Core FFO attributable to common interests in Operating Company and common stockholders: | |||||
| 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 (1) | (11,135 | ) | |||
| Gains and losses from sales of businesses within the Investment Management segment and impairment write-downs associated with the Investment Management segment | 2,542 | ||||
| CLNC Core Earnings & NRE Cash Available for Distribution adjustments (2) | (13,988 | ) | |||
| Equity-based compensation expense | 7,353 | ||||
| Straight-line rent revenue and expense | (5,495 | ) | |||
| Amortization of acquired above- and below-market lease values, net | (3,866 | ) | |||
| Amortization of deferred financing costs and debt premiums and discounts | 18,312 | ||||
| Unrealized fair value losses on interest rate and foreign currency hedges, and foreign currency remeasurements | 58,143 | ||||
| Acquisition and merger-related transaction costs | 2,895 | ||||
| Merger integration and restructuring costs (3) | 769 | ||||
| Amortization and impairment of investment management intangibles | 8,662 | ||||
| Non-real estate depreciation and amortization | 1,577 | ||||
| Amortization of gain on remeasurement of consolidated investment entities | 3,779 | ||||
| Deferred tax benefit, net | (2,663 | ) | |||
| Less: Adjustments attributable to noncontrolling interests in investment entities | 36 | ||||
| Core FFO attributable to common interests in Operating Company and common stockholders | $ | 47,713 | |||
| FFO per common share / common OP unit (4) | $ | (0.04 | ) | ||
| FFO per common share / common OP unit—diluted (4)(5) | $ | (0.04 | ) | ||
| Core FFO per common share / common OP unit (4) | $ | 0.09 | |||
| Core FFO per common share / common OP unit—diluted (4)(5)(6) | $ | 0.09 | |||
| Weighted average number of common OP units outstanding used for FFO and Core FFO per common share and OP unit (4) | 515,494 | ||||
| Weighted average number of common OP units outstanding used for FFO per common share and OP unit—diluted (4)(5) | 515,494 | ||||
| Weighted average number of common OP units outstanding used for Core FFO per common share and OP unit—diluted (4)(5)(6) | 519,446 | ||||
_____________________________________
| (1) | For the three months ended March 31, 2019, net of $43.4 million consolidated or $24.3 million CLNY OP share of depreciation, amortization and impairment charges previously adjusted to calculate FFO and Core Earnings, a non-GAAP measure used by Colony Capital, Inc. prior to its internalization of the manager. | |
| (2) | Represents adjustments to align the Company’s Core FFO with CLNC’s definition of Core Earnings and NRE’s definition of Cash Available for Distribution (“CAD”) to reflect the Company’s percentage interest in the respective company’s earnings. These adjustments include provisions for loan losses, realized gains and losses plus other differences that are included/excluded in CLNC’s core earnings and NRE’s CAD. | |
| (3) | Merger integration and restructuring costs represent costs and charges incurred during the integration of Colony, NSAM and NRF and from the corporate restructuring and reorganization plan. These integration and restructuring 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 and restructuring and reorganization plan. The majority of these costs consist of severance, employee costs of those separated or scheduled for separation, system integration and lease terminations. | |
| (4) | Calculated based on weighted average shares outstanding including participating securities and assuming the exchange of all common OP units outstanding for common shares. | |
| (5) | For the three months ended March 31, 2019, excluded in the calculation of diluted FFO and Core FFO per share is the effect of adding back interest expense associated with convertible senior notes and weighted average dilutive common share equivalents for the assumed conversion of the convertible senior notes as the effect of including such interest expense and common share equivalents would be antidilutive. | |
| (6) | Included in the calculation of diluted Core FFO per share are 3.8 million weighted average performance stock units, which are subject to both a service condition and market condition, and 137,918 weighted average shares of non-participating restricted stock for the three months ended March 31, 2019. | |
RECONCILIATION OF NET INCOME (LOSS)
TO NOI
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 and (2) a
reconciliation of such segments' net income (loss) for the three months
ended
| Three Months Ended March 31, 2019 | ||||||||||||||
|
(In thousands) |
Healthcare | Industrial | Hospitality | |||||||||||
| Total revenues | $ | 145,774 | $ | 82,372 | $ | 196,615 | ||||||||
| Straight-line rent revenue and amortization of above- and below-market lease intangibles | (5,227 | ) | (3,232 | ) | 310 | |||||||||
| Interest income | — | (180 | ) | — | ||||||||||
| Property operating expenses (1) | (64,302 | ) | (22,337 | ) | (136,345 | ) | ||||||||
| Compensation and administrative expense (1) | — | (784 | ) | — | ||||||||||
| NOI(2) | $ | 76,245 | $ | 55,839 | $ | 60,580 | ||||||||
_____________________________________
| (1) | For healthcare and hospitality, property operating expenses include property management fees paid to third parties. For industrial, there are direct costs of managing the portfolio which are included in compensation expense. | |
| (2) | For hospitality, NOI is before FF&E Reserve. |
| Three Months Ended March 31, 2019 | ||||||||||||||
|
(In thousands) |
Healthcare | Industrial | Hospitality | |||||||||||
| Income (loss) from continuing operations | $ | (7,206 | ) | $ | 24,154 | $ | (26,077 | ) | ||||||
| Adjustments: | ||||||||||||||
| Straight-line rent revenue and amortization of above- and below-market lease intangibles | (5,227 | ) | (3,232 | ) | 310 | |||||||||
| Interest income | — | (180 | ) | — | ||||||||||
| Interest expense | 47,527 | 14,627 | 42,065 | |||||||||||
| Transaction, investment and servicing costs | 3,108 | 530 | 1,584 | |||||||||||
| Depreciation and amortization | 40,131 | 39,445 | 36,248 | |||||||||||
| Impairment loss | — | — | 3,850 | |||||||||||
| Compensation and administrative expense | 1,653 | 3,504 | 1,904 | |||||||||||
| Gain on sale of real estate | — | (22,848 | ) | (139 | ) | |||||||||
| Other (gain) loss, net | (1,867 | ) | 8 | (1 | ) | |||||||||
| Income tax (benefit) expense | (1,874 | ) | (169 | ) | 836 | |||||||||
| NOI(1) | $ | 76,245 | $ | 55,839 | $ | 60,580 | ||||||||
_____________________________________
| (1) | For hospitality, NOI is before FF&E Reserve. |
The following table summarizes first quarter 2019 income (loss) from continuing operations by segment:
|
(In thousands) |
Income (Loss) From |
|||||||
| Healthcare | $ | (7,206 | ) | |||||
| Industrial | 24,154 | |||||||
| Hospitality | (26,077 | ) | ||||||
| CLNC | 5,513 | |||||||
| Other Equity and Debt | 59,563 | |||||||
| Investment Management | 22,777 | |||||||
| Amounts Not Allocated to Segments | (108,879 | ) | ||||||
| Total Consolidated | $ | (30,155 | ) | |||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190510005101/en/
Source:
Investor Contacts:
Addo Investor Relations
Lasse Glassen
310-829-5400
Attachment: Download