<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
MARCH 30, 2000
--------------
Date of Report (Date of earliest event reported)
AMERICAN REAL ESTATE PARTNERS, L.P.
------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C> <C>
DELAWARE 1-9516 13-3398766
-------- ------ ----------
(State of Organization) (Commission File Number) (IRS Employer Identification Number)
</TABLE>
100 SOUTH BEDFORD ROAD
MT. KISCO, NY 10549
-------------------
(Address of Registrant's Principal Executive Office) (Zip Code)
(914) 242-7700
--------------
(Registrant's telephone number, including area code)
------------------------
(Former Name or Former Address, if Changed Since Last Report)
<PAGE> 2
ITEM 5. OTHER EVENTS.
On March 30, 2000, the Registrant announced 1999 fourth quarter and full
year financial results and that no distributions are expected to be made
during 2000. Reference is made to the press release, dated March 30, 2000,
annexed hereto as Exhibit 21, for information regarding the announcement.
ITEM 7. EXHIBITS.
Exhibit No. Description of Document
21 Press Release, dated March 30, 2000.
1
<PAGE> 3
SIGNATURES
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 hereunto duly authorized.
AMERICAN REAL ESTATE PARTNERS, L.P.
(Registrant)
By: American Property Investors, Inc.
General Partner
By: /s/ John P. Saldarelli
----------------------------------
John P. Saldarelli
Secretary and Treasurer
Date: March 30, 2000
2
<PAGE> 4
EXHIBIT INDEX
Exhibit Number Description Page No.
- -------------- ----------- --------
21 Press Release, dated March 29, 1999. 4
3
<PAGE> 1
Contact: John P. Saldarelli
Secretary and Treasurer
(914) 242-7700
FOR IMMEDIATE RELEASE
AMERICAN REAL ESTATE PARTNERS, L.P.
REPORTS FULL YEAR AND FOURTH QUARTER RESULTS
AND THAT NO DISTRIBUTIONS ARE EXPECTED TO BE MADE IN 2000
MOUNT KISCO, NEW YORK, MARCH 30, 2000 - American Real Estate Partners, L.P.
(" AREP" ) (NYSE:ACP) today reported the following full year and fourth quarter
financial results:
For calendar year 1999, diluted earnings before property and securities
transactions and equity interest in affiliate per weighted average limited
partnership unit outstanding decreased from $1.06 in 1998 to $.91 in 1999. Net
gain from property and securities transactions and equity in earnings of
Stratosphere Corporation per weighted average limited partnership unit
outstanding was $.76 in 1999 compared to $.22 in 1998 primarily due to the 1999
non-recurring gain on the sale of RJR stock. For the calendar year 1999, diluted
earnings per weighted average limited partnership unit outstanding increased
from $1.28 in 1998 to $1.67 in 1999.
Earnings before property and securities transactions and equity interest in
affiliate decreased during calendar year 1999 by $6,574,000 as compared to
calendar year 1998, primarily due to decreased interest income, other income and
dividend income and increased interest expense, partially offset by increased
hotel and resort net operating income.
Earnings for the calendar year 1999 increased by $25,178,000 as compared to
earnings for calendar year 1998 primarily due to the 1999 non-recurring gain on
the sale of RJR stock.
For the fourth quarter of 1999 diluted earnings before property and securities
transactions and equity interest in affiliate per weighted average limited
partnership unit outstanding increased from $.22 in 1998 to $.23 in 1999, and
net gain from property and securities transactions and equity in earnings of
Stratosphere Corporation per weighted average limited partnership unit
outstanding was $.11 in 1999 compared to $.05 in 1998. For the
1
<PAGE> 2
quarter diluted earnings per weighted average limited partnership unit
outstanding increased from $.27 in 1998 to $.34 in 1999.
Earnings for the fourth quarter of 1999 increased by $4,431,000 as compared to
earnings for the fourth quarter of 1998, primarily due to the increased gain on
sales of real estate, partially offset by decreased gain on sale of limited
partnership interests.
AREP also announced that no distributions are expected to be made in 2000. In
making its announcement, AREP noted it plans to continue to apply available cash
flow toward its operations, repayment of maturing indebtedness, tenant
requirements and other capital expenditures and for Partnership contingencies
and reserves, including environmental matters and scheduled lease expirations.
By the end of the year 2002, net leases representing approximately 22.6% of
AREP's net annual rentals from its portfolio will be due for renewal, and by the
end of the year 2004, 35.1% of such rentals will be due for renewal. AREP
believes that it should continue to hold and invest, rather than distribute,
cash. No distributions were made to Unitholders during 1999.
AREP further stated it continues to believe that excess cash should be used to
enhance long-term Unitholder value through the improvement of its existing
assets, the support of AREP's debt and property obligations, and selected
investment in assets and companies with assets undervalued by the market as
appropriate opportunities arise. AREP believes it should continue to diversify
its portfolio and that in the real estate area it should seek to make
acquisitions of land for development and land development companies, and other
real estate operating companies which may have significant assets under
development, as well as non-performing loans and limited partnership units in
thinly traded syndicated real estate partnerships. AREP also noted it recently
closed on its previously reported agreement with affiliates of its general
partner for the acquisition of Bayswater Realty & Capital Corp., for
approximately $84.35 million. Bayswater owns interests in ten residential
subdivisions under development in New York and Florida.
AREP has acquired non-performing mortgage notes of companies in the gaming
industry undergoing restructuring as well as land it is developing. AREP also
noted it recently acquired an approximate 2% additional interest in the
Stratosphere Tower, Casino & Hotel from affiliates of its general partner,
(giving AREP approximately an aggregate 51% interest). AREP anticipates pursuing
additional investments in the gaming industry including the possible acquisition
of additional interests in the Stratosphere Tower, Casino & Hotel from
affiliates of the General Partner. Any such acquisition by AREP of additional
interests in Stratosphere may be made in exchange for Units in AREP, provided
the terms thereof are
2
<PAGE> 3
fair and reasonable to AREP. Likewise, investments by AREP in non-real estate
related assets may include debt or equity securities of companies which may be
undergoing recapitalization. These types of investments, both real estate and
non-real estate related, may involve debt restructuring, capital expenditures
and active asset management, and by their nature may not be readily financeable
and may not generate immediate positive cash flow. As such, they require AREP to
maintain a strong capital base both to react quickly to these market
opportunities as well as to allow AREP to rework the assets to enhance their
turnaround performance. AREP's investment strategy continues to include the
reinvestment of capital transaction proceeds and refinancing proceeds.
American Real Estate Partners, L.P. is a master limited partnership primarily
engaged in acquiring and managing real estate investments, with the primary
focus on office, retail, industrial, hotel and residential properties.
**TABLES FOLLOW**
3
<PAGE> 4
AMERICAN REAL ESTATE PARTNERS, L.P.
REPORTS FULL YEAR AND FOURTH QUARTER RESULTS
AND THAT NO DISTRIBUTIONS ARE EXPECTED TO BE MADE IN 2000
IN THOUSANDS OF DOLLARS EXCEPT PER SHARE DATA
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1999 1998
- ----------------------- ---- ----
<S> <C> <C>
Revenues $ 98,540 $ 93,306
============== ===============
Earnings before property and
securities transactions and
equity interest in affiliate $ 51,797 $ 58,371
Provision for loss on real estate (1,946) (1,180)
Gain on sales and disposition
of real estate 16,112 9,065
Gain on sale of limited partnership -
interests - 4,382
Gain on sale of marketable equity
securities 28,590 -
Equity in earnings of
Stratosphere Corporation 1,263 -
-------------- ---------------
Net earnings $ 95,816 $ 70,638
============== ===============
Net earnings per L.P. unit:
Basic:
Earnings before property and
securities transactions and
equity interest in affiliate $ 1.01 $ 1.16
Net gain from property and
securities transactions and
equity in earnings of
Stratosphere Corporation .94 .26
-------------- ---------------
Net earnings $ 1.95 $ 1.42
============== ===============
Weighted average units outstanding 46,098,284 46,173,284
============== ===============
Diluted:
Earnings before property and
securities transactions and
equity interest in affiliate $ .91 $ 1.06
Net gain from property and
securities transactions and
equity in earnings of
Stratosphere Corporation .76 .22
-------------- ---------------
Net earnings $ 1.67 $ 1.28
============== ===============
Weighted average units and equivalent
units outstanding 56,078,394 54,215,339
============== ===============
</TABLE>
CONTINUED..............
4
<PAGE> 5
AMERICAN REAL ESTATE PARTNERS, L.P.
REPORTS FULL YEAR AND FOURTH QUARTER RESULTS
AND THAT NO DISTRIBUTIONS ARE EXPECTED TO BE MADE IN 2000
IN THOUSANDS OF DOLLARS EXCEPT PER SHARE DATA
<TABLE>
<CAPTION>
FOURTH QUARTER ENDED DECEMBER 31, 1999 1998
- ---------------------------------- ---- ----
(UNAUDITED)
<S> <C> <C>
Revenues $ 24,191 $ 23,587
============= =============
Earnings before property and
securities transactions
and equity interest in affiliate 13,188 12,118
Provision for loss on real estate (582) (578)
Gain (loss) on sales and disposition
of real estate 7,164 (695)
Gain on sale of limited partnership
interests - 4,382
Equity in earnings of Stratosphere
Corporation (112)
-------------- -------------
Net earnings $ 19,658 $ 15,227
============== =============
Net earnings per L.P. unit:
Basic:
Earnings before property and
securities transactions and equity
interest in affiliate $ .26 $ .24
Net gain from property and
securities transactions and equity
in earnings of Stratosphere
Corporation .14 .06
-------------- -------------
Net earnings $ .40 $ .30
============== =============
Weighted average units
outstanding 46,098,284 46,098,284
============== =============
Diluted:
Earnings before property and
securities transactions and equity
interest in affiliate $ .23 $ .22
Net gain from property and securities
transactions and equity in earnings of
Stratosphere Corporation .11 .05
-------------- -------------
Net earnings $ .34 $ .27
============== =============
Weighted average units and
equivalent units outstanding 56,818,325 55,030,578
============== =============
</TABLE>
5
