Liberty Property Trust Announces First Quarter 2013 Results

 Liberty Property Trust 

 Statement of Operations 

March 31, 2013

 (Unaudited and in thousands, except per share amounts) 

 Quarter Ended 

March 31, 2013

March 31, 2012

 Operating Revenue 

 Rental  

$                           123,912

$                           117,369

  Operating expense reimbursement

52,661

49,573

 Total operating revenue 

176,573

166,942

 Operating Expenses 

  Rental property

31,916

30,018

 Real estate taxes 

21,552

20,311

 General and administrative

19,833

17,201

 Depreciation and amortization 

44,973

40,725

 Total operating expenses 

118,274

108,255

 Operating Income 

58,299

58,687

 Other Income/Expense 

 Interest and other  

2,632

2,460

 Interest  

(31,934)

(28,193)

 Total other income/expense 

(29,302)

(25,733)

 Income before property dispositions, income taxes, noncontrolling interest 

    and equity in earnings of unconsolidated joint ventures 

28,997

32,954

 Gain on property dispositions 

1,800

523

 Income taxes 

(491)

(178)

 Equity in earnings of unconsolidated joint ventures 

1,757

916

 Income from continuing operations 

32,063

34,215

 Discontinued operations (including net gains on property dispositions of 

$41,713 and $1,064 for the quarters ended March 31, 2013 and 2012, respectively)

42,593

5,387

 Net Income 

74,656

39,602

 Noncontrolling interest - operating partnerships 

(3,417)

(2,513)

 Noncontrolling interest - consolidated joint ventures 

-

-

 Net Income available to common shareholders     

$                             71,239

$                             37,089

 Net income 

$                             74,656

$                             39,602

 Other comprehensive (loss) income 

(4,851)

2,317

 Comprehensive income 

69,805

41,919

 Less: comprehensive income attributable to noncontrolling interest 

(3,271)

(2,586)

 Comprehensive income attributable to common shareholders 

$                             66,534

$                             39,333

 Basic income per common share  

 Continuing operations 

$                                 0.25

$                                 0.28

 Discontinued operations 

$                                 0.35

$                                 0.04

 Total basic income per common share 

$                                 0.60

$                                 0.32

 Diluted income per common share 

 Continuing operations 

$                                 0.25

$                                 0.28

 Discontinued operations 

$                                 0.35

$                                 0.04

 Total diluted income per common share 

$                                 0.60

$                                 0.32

 Weighted average shares 

 Basic 

118,688

115,972

 Diluted 

119,532

116,743

 Amounts attributable to common shareholders     

 Income from continuing operations 

$                             29,925

$                             31,872

 Discontinued operations 

41,314

5,217

 Net income 

$                             71,239

$                             37,089

 Liberty Property Trust 

 Statement of Funds From Operations 

March 31, 2013

 (Unaudited and in thousands, except per share amounts) 

 Quarter Ended 

March 31, 2013

March 31, 2012

Per 

Per 

Weighted

Weighted

 Average  

 Average  

Dollars

Share

Dollars

Share

 Reconciliation of net income to FFO - basic: 

 Basic - income available to common shareholders 

$              71,239

$             0.60

$              37,089

$                         0.32

 Adjustments: 

 Depreciation and amortization of unconsolidated joint ventures 

3,397

3,616

 Depreciation and amortization 

44,972

41,046

 Gain on property dispositions/impairment 

(41,706)

(1,104)

 Noncontrolling interest share in addback for depreciation and amortization 

 and gain on property dispositions/impairment 

(200)

(1,373)

 Funds from operations available to common shareholders - basic 

$              77,702

$             0.65

$              79,274

$                         0.68

 Reconciliation of net income to FFO - diluted: 

 Diluted - income available to common shareholders 

$              71,239

$             0.60

$              37,089

$                         0.32

 Adjustments: 

 Depreciation and amortization of unconsolidated joint ventures 

3,397

3,616

 Depreciation and amortization  

44,972

41,046

 Gain on property dispositions/impairment 

(41,706)

(1,104)

 Noncontrolling interest excluding preferred unit distributions  

2,206

1,207

 Funds from operations available to common shareholders - diluted 

$              80,108

$             0.65

$              81,854

$                         0.68

 Reconciliation of weighted average shares: 

 Weighted average common shares - all basic calculations 

118,688

115,972

 Dilutive shares for long term compensation plans 

844

771

 Diluted shares for net income calculations 

119,532

116,743

 Weighted average common units 

3,714

3,809

 Diluted shares for Funds from operations calculations 

123,246

120,552

The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company's operating performance that excludes depreciation and amortization and gains and losses from property dispositions.  As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income.  In addition, management believes that Funds from operations provides useful information to the investment community about the Company's financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT.  Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles ("GAAP")), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders does not represent net income or cash flows from operations as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. Funds from operations available to common shareholders also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP.

Liberty Property Trust

Balance Sheet 

March 31, 2013

(Unaudited and in thousands, except share and unit amounts)

March 31, 2013

December 31, 2012

Assets

Real estate:

Land and land improvements

$                         900,963

$                         899,801

Building and improvements

4,374,877

4,341,125

Less: accumulated depreciation

(1,178,309)

(1,164,756)

Operating real estate

4,097,531

4,076,170

Development in progress

209,690

248,602

Land held for development

246,572

258,324

Net real estate

4,553,793

4,583,096

Cash and cash equivalents

54,434

38,356

Restricted cash

28,212

33,147

Accounts receivable

8,355

8,988

Deferred rent receivable

110,078

108,576

Deferred financing and leasing costs, net of accumulated

amortization (2013, $134,299; 2012, $132,261)

134,316

137,359

Investments in and advances to unconsolidated joint ventures

175,285

169,021

Assets held for sale  

7,829

7,880

Prepaid expenses and other assets

74,371

87,756

Total assets

$                      5,146,673

$                      5,174,179

Liabilities

Mortgage loans

$                         304,867

$                         302,855

Unsecured notes

2,258,946

2,258,751

Credit facility

-

92,000

Accounts payable 

32,152

31,058

Accrued interest

39,031

20,164

Dividend and distributions payable

59,813

58,038

Other liabilities

167,337

185,956

Total liabilities

2,862,146

2,948,822

Noncontrolling interest - operating partnership - 301,483 preferred units

outstanding as of March 31, 2013 and December 31, 2012

7,537

7,537

Equity

Shareholders' equity:

Common shares of beneficial interest, $.001 par value, 183,987,000 shares

authorized, 121,181,984 (includes 1,249,909 in treasury) and 119,720,776

(includes 1,249,909 in treasury) shares issued and outstanding as of 

March 31, 2013 and December 31, 2012, respectively

121

119

Additional paid-in capital

2,737,071

2,687,701

Accumulated other comprehensive (loss) income

(1,805)

2,900

Distributions in excess of net income

(533,471)

(547,757)

Common shares in treasury, at cost, 1,249,909 shares as of

March 31, 2013 and December 31, 2012

(51,951)

(51,951)

Total shareholders' equity

2,149,965

2,091,012

Noncontrolling interest - operating partnership

3,713,851 common units outstanding as of March 31, 2013 and December 31, 2012 

60,440

60,223

1,290,000 preferred units outstanding as of March 31, 2013 and December 31, 2012 

63,264

63,264

Noncontrolling interest - consolidated joint ventures

3,321

3,321

Total equity

2,276,990

2,217,820

Total liabilities, noncontrolling interest - operating partnership & equity

$                      5,146,673

$                      5,174,179