submitted on 9-19-2012 by CBLShopping center developer CBL & Associates Properties Inc. on Wednesday reported adjusted funds from operations rose slightly in its third quarter, but same-center net operating income was flat compared to a year ago.
Chattanooga-based CBL reported that FFO was $95 million, or 56 cents per share, compared with $93 million, or 55 cents per share, for the quarter a year ago. That hit the average estimate from analysts for the quarter.
CBL Chief Executive Officer Stephen Lebovitz said in a statement that the company, which operates both Hamilton Place and Northgate malls in Chattanooga, is on track to achieve the mid-to-high end of its FFO guidance. CBL reiterated guidance, as adjusted, in the range of $2.25 to $2.32 per share for all of 2015.
But Lebovitz said vacancies resulting from bankruptcies earlier in the year have created challenges for the company in 2015.
Still, he said strong sales growth also continued this quarter, and officials expect a favorable holiday season for its retailers and properties.
CBL shares closed on the New York Stock Exchange at $15.48, up 43 cents, or 2.86 percent. The company released its third quarter results after the market closed Wednesday.
CBL posted net income for the quarter of $26.3 million, or 15 cents per share. That’s compared with net income of $38.1 million, or 22 cents per share, a year ago. The decline in net income is primarily a result of the $18.3 million gain on extinguishment of debt recorded in the third quarter 2014, the company said.
The company reported same-center revenues increased $2.1 million in the third quarter, but that was offset by a $2.1 million rise in expenses.
Minimum rents increased $200,000 during the quarter and other rents grew by $400,000 as a result of growth in sponsorship and branding revenue.
Tenant reimbursement increased by $800,000, though that was offset by a $1.8 million variance in real estate tax expense and a $400,000 increase in maintenance and repair expense, according to CBL.
Lebovitz said recent key financial transactions, including recasting its unsecured credit facilities, entering into a new unsecured term loan and refinancing two secured loans, have substantially reduced its cost of borrowing and extended its maturity schedule.
“Improving our balance sheet remains a key strategic priority for us,” he said.