SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED APRIL 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO
__________
Commission file number 1-8459
NEW PLAN REALTY TRUST AND SUBSIDIARIES
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 13-1995781
(State or other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
1120 Avenue of the Americas, New York, New York 10036
(Address of Principal Executive Office) (Zip Code)
212-869-3000
Registrant's Telephone Number
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
The number of shares outstanding at June 2, 1995 was 53,105,634.
Total number of pages 12
<PAGE>
NEW PLAN REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
April 30, 1995 AND JULY 31, 1994
(UNAUDITED) (IN THOUSANDS)
ASSETS: 4/30/95 7/31/94
Real estate, at cost
Land and buildings $689,718 $621,342
Less accumulated depreciation
and amortization 59,909 49,102
________ ________
629,809 572,240
Cash and cash equivalents 38,211 3,116
Marketable securities (Note B) 5,851 6,293
Mortgages and notes receivable 22,883 22,910
Trade and notes receivable 7,436 6,290
Other receivables 1,506 1,628
Prepaid expenses and deferred charges 4,066 2,429
Other assets 2,125 2,087
________ ________
TOTAL ASSETS $711,887 $616,993
======== ========
LIABILITIES:
Mortgages payable $ 30,496 $ 28,060
Notes payable bank (Note C) --- 7,500
7.75% Senior Notes payable,
due 4/6/05, net of unamortized
discount of $1,357,000 (Note D) 98,643 ---
Other liabilities 10,500 13,666
Tenants' security deposits 2,902 2,274
________ ________
TOTAL LIABILITIES 142,541 51,500
________ ________
SHAREHOLDERS' EQUITY:
Shares of beneficial interest
without par value, unlimited
authorization;issued
and outstanding** 619,217 609,067
Less:
Loans receivable for
share purchases 3,445 3,630
Distributions in excess of
net income 46,405 39,944
Unrealized loss on securities
reported at fair value (Note B)
21
________ ________
TOTAL SHAREHOLDERS' EQUITY 569,346 565,493
________ ________
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $711,887 $616,993
======== ========
** SHARES ISSUED AND OUTSTANDING 53,105 52,594
======== ========
See accompanying notes to consolidated financial statements.
<PAGE>
NEW PLAN REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
THREE MONTHS ENDED NINE MONTHS ENDED
4/30/95 4/30/94 4/30/95 4/30/94
________ ________ _______ ________
REVENUES
Rental income and
related revenues $31,711 $25,388 $92,075 $69,268
Interest and dividend
income 1,046 899 2,704 3,785
_______ _______ _______ _______
TOTAL REVENUE 32,757 26,287 94,779 73,053
_______ _______ _______ _______
OPERATING EXPENSES
Operating costs 6,995 6,167 21,551 15,783
Leasehold rents 138 135 415 387
Real estate and other
taxes 3,054 2,387 8,805 6,933
Interest expense 2,104 640 3,766 1,618
Depreciation and amortization 3,741 3,023 10,871 8,241
Provision for doubtful
accounts, net of recoveries
(Note F) 311 230 680 783
_______ _______ _______ _______
TOTAL OPERATING EXPENSES 16,343 12,582 46,088 33,745
_______ _______ _______ _______
Administrative expenses 552 567 1,724 2,156
_______ _______ _______ _______
INCOME BEFORE GAIN ON SALE
OF PROPERTY AND SECURITIES 15,862 13,138 46,967 37,152
_______ _______ _______ _______
Gain/(Loss) on sale of property -- -- -- 460
Gain on sale of securities, net -- -- -- 531
_______ _______ _______ _______
NET INCOME $15,862 $13,138 $46,967 $38,143
======= ======= ======= =======
NET INCOME PER SHARE $.30 $.27 $.89 $.78
DIVIDENDS PER SHARE $.34 $.33 $1.0125 $.9825
WEIGHTED AVERAGE SHARES
OUTSTANDING 52,994 49,310 52,808 49,148
See accompanying notes to consolidated financial statements.
<PAGE>
NEW PLAN REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)(IN THOUSANDS)
NINE MONTHS ENDED
4/30/95 4/30/94
------- -------
OPERATING ACTIVITIES
Net Income $46,967 $38,143
Adjustment to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 10,871 8,241
------- ------
57,838 46,384
Gain on sale of property -- (460)
Gain on sale of securities, net -- (531)
Changes in operating assets and
liabilities, net
Increase in trade and notes receivable (1,561) (3,236)
Decrease in other receivables 122 331
Increase in allowance for doubtful accounts 415 108
Increase in other liabilities 248 (139)
Increase in net sundry assets and
liabilities (455) (288)
NET CASH PROVIDED BY OPERATING ACTIVITIES 56,607 42,169
------ ------
INVESTING ACTIVITIES
Sales of marketable securities 421 42,223
Purchases of marketable securities -- (1,298)
Net proceeds from the sale of property -- 1,996
Purchase and improvement of properties (66,345) (160,715)
Increase in notes receivable -- (300)
Repayment of mortgage notes receivable 27 1,517
NET CASH USED IN INVESTING ACTIVITIES (65,897) (116,577)
FINANCING ACTIVITIES
Distributions to shareholders (53,429) (48,255)
Issuance of shares of beneficial interest
pursuant to dividend reinvestment plan 10,129 10,276
Issuance of shares of beneficial interest upon
exercise of stock options 21 287
Proceeds from short-term borrowing 332,000 25,000
Repayment of short-term borrowing (339,500) --
Proceeds from sale of 7.75% Senior Notes 98,637 --
Payment of deferred financing costs (650) --
Principal payments on mortgages (258) (246)
Repayment of mortgages (2,750) (7,214)
Repayment of loans receivable for the
purchase of shares of beneficial interest 185 281
----- -----
NET CASH PROVIDED BY/(USED IN) FINANCING
ACTIVITIES 44,385 (19,871)
------- --------
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 35,095 (94,279)
Cash and cash equivalents at beginning of year 3,116 102,312
------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 38,211 $ 8,033
======== ========
See accompanying notes to consolidated financial statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A:
The accompanying unaudited condensed consolidated financial statements have
been prepared by the Trust pursuant to the rules of the Securities and
Exchange Commission ("SEC") and, in the opinion of the Trust, include all
adjustments (consisting of normal recurring adjustments) necessary for a fair
presentation of financial position, results of operations and cash flows in
accordance with generally accepted accounting principles. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such SEC rules. The
Trust believes that the disclosures made are adequate to make the information
presented not misleading. The consolidated statements of income for the
three month and nine month periods ended April 30, 1995 are not necessarily
indicative of the results expected for the full year. These financial
statements should be read in conjunction with the audited financial
statements and notes thereto included in the Trust's latest annual report on
Form 10-K.
Note B: Available For Sale of Securities Reported As a Component Of
Shareholders' Equity
The Trust has adopted Statement of Financial Accounting Standards 115
"Accounting for Certain Investments in Debt and Equity Securities" and,
accordingly, has classified all such investments as available-for-sale. All
investments are recorded at current market value with an offsetting
adjustment to Shareholders' Equity.
April 30, 1995 July 31, 1994
Equity Debt Equity Debt
------ ------ ------ ------
Amortized cost/cost basis $ 980 $4,892 $ 977 $5,316
Unrealized holdings gains 733 -- -- --
Unrealized holdings losses -- (754) -- --
______ ______ ______ ______
Fair value $1,713 $4,138 $ 977 $5,316
====== ====== ====== ======
The debt securities have maturity dates ranging from 1996 to 2009.
Note C: Notes Payable
The Trust has an unsecured revolving credit facility which provides for up to
$100 million of until November 28, 1995. At the time of borrowing, the Trust
can choose from three interest rate options. There are restrictive covenants
that place a ceiling on total indebtedness of the lesser of 50% of tangible
net worth or $250,000,000, a ceiling on mortgage indebtedness of
$105,000,000, a minimum interest coverage ratio of 2.5 to 1 and a minimum
tangible net worth of $400,000,000.
<PAGE>
Note D: 7.75% Senior Notes Payable
In April, 1995 the Trust issued $100 million face amount 7.75% unsecured ten
year Senior Notes due April 6, 2005. The effective interest on the notes is
7.95%. The notes were issued at a discount of $1,363,000 which is being
amortized over their life using the effective interest method. Interest is
payable semiannually and the principal is due at maturity. There is a
restrictive covenant that limits the amount of additional debt that can be
incurred to 65% of total assets. For the nine and three months ended April
30, 1995, $6,000 of amortized discount was included in interest expenses.
Note E: Supplemental Cash Flow Information
State and local income taxes paid for the nine months ended April 30, 1995
and 1994 were $121,000 and $108,000, respectively.
Interest paid for the nine months ended April 30, 1995 and 1994 was
$4,220,000 and $1,914,000, respectively.
Interest costs capitalized for the nine months ended April 30, 1995 and 1994
were $978,000 and $296,000, respectively.
The Trust entered into the following non-cash investing and financing
activities (in thousands):
4/30/95 4/30/94
------- -------
Mortgage obligations assumed upon
the purchase of property $5,443 $12,019
Discount on issuance of 7.75%
Senior Notes $1,363
Note F: Provision for Doubtful Accounts
The provision for doubtful accounts is net of recoveries. For the nine
months ended April 30, 1995 and 1994, recoveries were $400,000 and $201,000,
respectively. For the three months ended April 30, 1995 and 1994, recoveries
were $56,000 and $27,000, respectively.
<PAGE>
Note G: Subsequent Event
Id June, 1995 the Trust issued $81 million face amount 6.8% unsecured Senior
Notes (the "Notes") due May 15, 2002. The Notes were issued at a discount of
$314,280 which will be amortized over the life of the Notes using the
effective interest method. Interest is payable semiannually and the
principal is due at maturity.
Note H: Impact of New Accounting Standard
In March, 1995 the Financial Accounting Standards Board issued FSAS 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets
to be Disposed Of". The Trust is currently assessing the impact of this
statement, which will be effective for financial statements issued for fiscal
year beginning December 15, 1995.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
I. Liquidity and Capital Resources
On April 30, 1995 the Trust had $44,062,000 in available cash, cash
equivalents and marketable securities.
Debt at April 30, 1995 consisted of $30,496,000 of mortgages and
$98,643,000 of 7.75% Senior Notes payable net of unamortized discount.
On April 6, 1995, the Trust issued 7.75% Senior Notes due April 6, 2005.
Proceeds received by the Trust, net of discounts and underwriting fees,
were $97,987,000.
The dividend reinvestment program provided $10,129,000 during the nine
month period ended April 30, 1995. In addition, the Trust made dividend
distributions of $53,429,000 to shareholders, paid $39,400,000 to
acquire seven shopping centers (803,000 gross leasable square feet) and
two apartment properties (294 units) and spent approximately $26,945,000
in expansion and improvements to properties.
Funds from operations (net income plus depreciation and amortization of
properties less gains from asset sales) increased $12,445,000 to
$57,838,000 ($1.10/share) from $45,393,000 ($.92/share) in the prior
year's nine month period.
Subsequent to April 30, 1995 the Trust issued $81 million face amount
unsecured 6.8% Senior Notes due May 15, 2002. Proceeds, net of discount
and underwriting fees, were $80,379,000.
II. Results of operations for the nine months ended April 30, 1995 and 1994
A. Revenues
Rental income and related revenues increased $22,807,000 to
$92,075,000. The increase was primarily due to the acquisition of
new properties and the expansion of two factory outlet centers.
All classes of property had increased revenue.
Interest and dividend income decreased $1,081,000 due to a reduced
investment base during this period compared to the prior year. The
lower investment base is a result of funds used for the purchase of
34 properties (22 shopping centers, nine apartments, three factory
outlets) since July 31, 1993.
<PAGE>
B. Operating Expenses
Operating costs and leasehold rents increased $5,796,000 to
$21,966,000. The increase was due primarily to the acquisition of
new properties.
Real estate and other taxes increased $1,872,000 to $8,805,000.
The increase was due primarily to new property acquisitions.
Interest expense increased $2,148,000 to $3,766,000. The increase
is due to a higher level of debt caused by the assumption of
mortgages in connection with the purchase of two properties, the
use of the Trust's $100 million unsecured revolving line of credit
and the issuance of $100 million 7.75% Senior Notes in April, 1995.
The increase in interest expense was partially offset by the
capitalization of interest on construction projects which expanded
several factory outlets and a shopping center.
Depreciation and amortization of properties increased $2,630,000
to $10,871,000. This was due primarily to the acquisition of
properties.
Provision for doubtful accounts, net recoveries, decreased
principally because recoveries were higher than they were in the
nine months of fiscal 1994.
C. Administrative Expenses
Administrative expenses as a percentage of total revenue decreased
to 1.8% from 3.0%. The decrease was due primarily to the increase
in revenue from newly acquired properties without a corresponding
increase in expenses.
D. Gains on property and securities
There were neither property sales nor sales of securities during
the nine months ended April 30, 1995.
<PAGE>
III. Results of operations for the three months ended April 30, 1995 and 1994
A. Revenues
Rental income and related revenues increased $6,323,000 to
$31,711,000. The increase was primarily due to the acquisition of
new properties. In addition, there was an increase in revenues in
all categories of properties owned in both periods.
Interest and dividend income increased $147,000 due to the
investment of the uncommitted proceeds from the sale of 7.75%
Senior Notes in April, 1995. During May, 1995 these proceeds were
invested in newly acquired properties.
B. Operating Expenses
Operating costs and leasehold rents increased $831,000 to
$7,133,000. The increase was due primarily to the acquisition of
new properties.
Real estate and other taxes increased $667,000 to $3,054,000. The
increase was due primarily to new property acquisitions.
Interest expense increased $1,464,000 to $2,104,000. The increase
was due primarily to the higher level of debt resulting from the
use of the Trust's $100 million unsecured revolving line of credit
and the issuance of $100 million 7.75% Senior Notes in April, 1995.
In addition, the prior period's expense had been reduced because of
the capitalization of interest on construction projects. There was
no capitalization of interest in the current quarter.
Depreciation and amortization of properties increased $718,000
to $3,741,000. This was due primarily to the acquisition of
properties.
C. Administrative Expenses
Administrative expenses as a percentage of total revenue decreased
to 1.7% from 2.2%. The decrease was due primarily to the increase
in revenue from newly acquired properties without a corresponding
increase in expenses.
<PAGE>
IV. Impact of new accounting standard
In March, 1995 the Financial Accounting Standards Board issued FSAS 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of". The Trust is currently assessing the impact
of this statement, which will be effective for financial statements
issued for fiscal year beginning December 15, 1995.
PART II - OTHER INFORMATION
Item 4. None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit: The following exhibit is being filed:
11.1 Statement of Computation of Earnings Per Share
(b) For EDGAR filing purposes only, this report contains Exhibit 27,
Financial Data Schedule.
(c) During the period covered by this report the Trust filed the
following reports on Form 8-K:
1. Form 8-K/A Amendment 2 dated March 23, 1995 to Form 8-K dated
July 14, 1994. This report contained Item 7: Financial
Statements, Pro Forma Financial Statements and Exhibits
(Consent of the Independent Accountants).
2. Form 8-K/A Amendment 2 dated March 23, 1995 to Form 8-K dated
August 8, 1994. This report contained Item 7: Financial
Statements, Pro Forma Financial Statements and Exhibits
(Consent of the Independent Accountants).
3. Form 8-K dated March 27, 1995 (filed March 28, 1995). This
report contained the indenture agreement for the Trust's 7.75%
Senior Notes.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
Dated: June 8, 1995
NEW PLAN REALTY TRUST
By:/s/ Michael I. Brown
------------------------
MICHAEL I. BROWN
Chief Financial Officer,
Controller
<PAGE>
NEW PLAN REALTY TRUST
INDEX TO EXHIBITS
No.
11.1 Statement of Computation of Earnings Per Share
27 Financial Data Schedule (1)
(1) Filed in electronic format only.<PAGE>
Exhibit 11.1
------------
Statement of Computation of Earnings Per Share
for the Nine Months Ended April 30, 1995
Earnings Per Share
Primary Fully Diluted
1. Proceeds upon exercise of
options $38,149,000 $38,149,000
2. Market price of shares
Closing --- $20.750
Average $20.694 ---
3. Treasury shares that could be
repurchased 1,843,481 1,838,506
4. Option shares outstanding 1,932,300 1,932,300
5. Common stock equivalent shares 88,819 93,794
(Excess shares under option over
treasury shares that could be
repurchased)
6. Weighted average number of
shares outstanding 52,808,210 52,808,210
7. Total number of common and
common share equivalents 52,897,02 52,902,004
8. Net income for the period $46,967,000 $46,967,000
9. Earnings per share $.89 $.89
10. Reported earnings per share $.89 Not applicable
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> This Schedule contains summary financial information
extracted from the consolidated balance sheets and consolidated
statements of income and is qualified in its entirety by
reference to such financial statements.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> APR-30-1995
<PERIOD-END> APR-30-1995
<CASH> 38,211
<SECURITIES> 5,851
<RECEIVABLES> 7,436<F1>
<ALLOWANCES> 2,746
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 689,718
<DEPRECIATION> 59,909
<TOTAL-ASSETS> 711,887<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 129,139
<COMMON> 615,772
0
0
<OTHER-SE> (46,426)
<TOTAL-LIABILITY-AND-EQUITY> 711,887<F3>
<SALES> 0
<TOTAL-REVENUES> 94,779
<CGS> 0
<TOTAL-COSTS> 41,642
<OTHER-EXPENSES> 1,724
<LOSS-PROVISION> 680
<INTEREST-EXPENSE> 3,766
<INCOME-PRETAX> 46,967
<INCOME-TAX> 0
<INCOME-CONTINUING> 46,967
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 46,967
<EPS-PRIMARY> .89
<EPS-DILUTED> .89
<FN>
<F1> Notes and Accounts Receivables-Trade is Net of Allowances
for Doubtful Accounts.
<F2> Other Assets not shown are: Mortgages and Notes Receivable,
Other Receivables, Prepaid Expenses and Deferred Charges,
Other Assets which total $30,580.
<F3> Additional Liabilities not shown are: Other Liabilities, and
Tenants' Security Deposits which total $13,402.
</TABLE>
