Macerich Announces Quarterly Results

SANTA MONICA, Calif., Aug. 11, 2020 /PRNewswire/ -- The Macerich Company (NYSE: MAC) today announced results of operations for the quarter ended June 30, 2020, which included net loss attributable to the Company of $25.1 million or $0.18 per share-diluted for the quarter ended June 30, 2020 compared to net income of $15.7 million or $0.11 per share-diluted attributable to the Company for the quarter ended June 30, 2019. For the second quarter 2020, funds from operations ("FFO")-diluted, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt was $60.5 million or $0.39 per share-diluted compared to $133.6 million or $0.88 per share-diluted for the quarter ended June 30, 2019. A description and reconciliation of earnings per share ("EPS")-diluted to FFO per share-diluted, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt is included within the financial tables accompanying this press release.

Results and Highlights:

• The majority of the properties in the portfolio have resumed operations, with the exception of two malls in New York City and nine indoor malls in California that were recently closed for a second time pursuant to a statewide mandate.
• Mall portfolio occupancy, including closed centers, was 91.3% at June 30, 2020, compared to 94.1% at June 30, 2019.   
• Mall tenant annual sales per square foot for the portfolio decreased to $774 for the twelve months ended June 30, 2020, compared to $776 for the twelve months ended June 30, 2019. This sales metric excludes the period of COVID-19 closure for each tenant.
• Average rent per square foot increased 2.1% to $62.48 at June 30, 2020, compared to $61.17 at June 30, 2019.

"We continued to make progress re-opening our properties and partnering with our tenants to prioritize the health and safety of employees, tenants, service providers and shoppers. Communities are responding positively to the return of our centers, with pent-up demand for the in-store retail experience driving steady traffic and increased customer conversion rates that are exceeding expectations," said the Company's Chief Executive Officer, Thomas O'Hern. "As we look ahead, we are encouraged by the pipeline of new store openings for the remainder of 2020 and into 2021 and believe retailers will continue to prioritize store operations in highly productive town centers, positioning Macerich for success.  We are confident that the quality and scale of our portfolio, along with our financial resources, will provide us the flexibility to successfully navigate the current environment."

COVID-19 Update:

The majority of the Company's properties are now open, the exceptions being Queens Center and Kings Plaza in New York City, which have been closed since March 2020, and nine indoor California malls that had previously opened in May and early June, but were closed for a second time in July pursuant to a statewide mandate. Those nine California malls include Fresno Fashion Fair, Inland Center, Lakewood Center, Los Cerritos Center, Stonewood Mall, The Mall at Victor Valley, The Oaks, Pacific View and Vintage Faire Mall. The duration of the nine recent California center closures is yet undetermined.

The Company is making meaningful progress in its negotiations with national and local tenants to secure rental payments. As a result of this progress, cash receipts continue to improve with approximately 58% and 66% of billings collected in June and July, respectively.

Store Openings:

Despite the unprecedented disruption from COVID-19, plans for new retail stores and other openings continue with leases for over 90 new locations in nearly 570,000 square feet targeted for the second half of 2020, including the following: Restoration Hardware Gallery at Village of Corte Madera; Round One and Dicks Sporting Goods in a portion of the former Sears building at Deptford Mall; Ardene, DSW and Industrious at Fashion District of Philadelphia; Tesla in a two level flagship store at Santa Monica Place; Gucci in a relocated and expanded store at Fashion Outlets of Chicago; Tory Burch and Adidas at Fashion Outlets of Niagara; X Lanes Bowling at Fresno Fashion Fair; lululemon athletica at Twenty Ninth Street; Capital One Café, Bulgari and Francine's at Scottsdale Fashion Square; and West Elm and Madewell at La Encantada. In total, the Company has entered into numerous leases for new stores and concepts totaling nearly 1.3 million square feet, for planned openings in primarily 2020 and 2021.

Redevelopment:

While the Company has reduced its planned 2020 development expenditures by approximately $90 million, work continues on select projects. Notably, One Westside in Los Angeles, a 584,000 square foot creative office redevelopment continues on schedule with a planned delivery to Google in early 2022. Redevelopment of the former Sears store at Deptford Mall in Deptford, NJ is on schedule, with expected openings of Round One and Dicks Sporting Goods this fall. This will be an exciting addition to the property, adding to an ever-growing relationship with both companies.     

Dividend:

The Company's Board of Director's declared a quarterly cash dividend of $0.15 per share of common stock.  The dividend is payable on September 8, 2020 to stockholders of record at the close of business on August 19, 2020. The Board's decision to reduce the dividend allows the Company to preserve liquidity and financial flexibility given the continued uncertain economic environment resulting from the COVID-19 pandemic.

Guidance:

On March 27, 2020, given the complex and rapidly evolving circumstances surrounding the COVID-19 pandemic, the Company withdrew its previously published 2020 Guidance, and is not providing an updated outlook at this time as a result of continued uncertainties.  

Macerich is a fully integrated, self-managed and self-administered real estate investment trust, which focuses on the acquisition, leasing, management, development and redevelopment of regional malls throughout the United States.

Macerich currently owns 51 million square feet of real estate consisting primarily of interests in 47 regional shopping centers. Macerich specializes in successful retail properties in many of the country's most attractive, densely populated markets with significant presence in the West Coast, Arizona, Chicago and the Metro New York to Washington, DC corridor.  A recognized leader in sustainability, Macerich has achieved the #1 GRESB ranking in the North American Retail Sector for five straight years (2015 – 2019). Additional information about Macerich can be obtained from the Company's website at www.Macerich.com.

Investor Conference Call:

The Company will provide an online Web simulcast and rebroadcast of its quarterly earnings conference call.  The call will be available on The Macerich Company's website at www.macerich.com (Investors Section).  The call begins on August 11, 2020 at 10:00 AM Pacific Time. To listen to the call, please go to the website at least 15 minutes prior to the call in order to register and download audio software if needed. An online replay at www.macerich.com (Investors Section) will be available for one year after the call. 

The Company will publish a supplemental financial information package which will be available at www.macerich.com in the Investors Section.  It will also be furnished to the SEC as part of a Current Report on Form 8-K.

Note:  This release contains statements that constitute forward-looking statements which can be identified by the use of words, such as  "expects," "anticipates," "assumes," "projects," "estimated" and "scheduled" and similar expressions that do not relate to historical matters. Stockholders are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to vary materially from those anticipated, expected or projected.  Such factors include, among others, general industry, as well as national, regional and local economic and business conditions, which will, among other things, affect demand for retail space or retail goods, availability and creditworthiness of current and prospective tenants, anchor or tenant bankruptcies, closures, mergers or consolidations, lease rates, terms and payments, interest rate fluctuations, availability, terms and cost of financing and operating expenses; adverse changes in the real estate markets including, among other things, competition from other companies, retail formats and technology, risks of real estate development and redevelopment, and acquisitions and dispositions; the adverse impact of the novel coronavirus (COVID-19) on the U.S., regional and global economies and the financial condition and results of operations of the Company and its tenants; the liquidity of real estate investments; governmental actions and initiatives (including legislative and regulatory changes); environmental and safety requirements; and terrorist activities or other acts of violence which could adversely affect all of the above factors.  The reader is directed to the Company's various filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2019 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2020 for a discussion of such risks and uncertainties, which discussion is incorporated herein by reference. The Company does not intend, and undertakes no obligation, to update any forward-looking information to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events unless required by law to do so.

(See attached tables)

SOURCE Macerich Company