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Arbor Realty Trust Reports Third Quarter 2009 ResultsNovember 6, 2009 8:30 AM ET
Article tools
Third Quarter Highlights:
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Quarter Ended Nine Months Ended
September 30, September 30,
------------- -------------
2009 2008 2009 2008
---- ---- ---- ----
Revenue:
Interest income $30,416,621 $51,423,427 $92,604,628 $158,708,921
Property operating
income 385,112 - 576,324 -
Other income 1,857 17,208 800,517 66,530
----- ------ ------- ------
Total revenue 30,803,590 51,440,635 93,981,469 158,775,451
---------- ---------- ---------- -----------
Expenses:
Interest expense 20,797,420 28,198,310 61,039,357 87,359,731
Employee compensation
and benefits 2,136,499 1,906,843 8,038,394 6,570,188
Selling and
administrative 4,092,293 2,581,132 8,856,214 6,741,446
Property operating
expenses 608,450 - 933,773 -
Depreciation and
amortization 26,037 - 26,037 -
Other-than-temporary
impairment 29,395 12,747,306 411,525 12,747,306
Provision for loan
losses 51,000,000 3,000,000 141,500,000 8,000,000
Loss on restructured
loans 300,000 - 33,127,749 -
Management fee -
related party 6,136,170 (1,217,148) 13,136,170 3,516,124
--------- ---------- ---------- ---------
Total expenses 85,126,264 47,216,443 267,069,219 124,934,795
---------- ---------- ----------- -----------
(Loss) income from
continuing
operations before
gain on exchange
of profits interest,
gain on
extinguishment of
debt, loss on
termination of
swaps and income
(loss) from equity
affiliates (54,322,674) 4,224,192 (173,087,750) 33,840,656
Gain on exchange
of profits
interest - - 55,988,411 -
Gain on
extinguishment of
debt 6,348,128 - 54,080,118 -
Loss on termination
of swaps - - (8,729,408) -
Income (loss) from
equity affiliates 8,856,060 (1,606,505) (1,300,958) (2,168,505)
--------- ---------- ---------- ----------
Net (loss) income
from continuing
operations (39,118,486) 2,617,687 (73,049,587) 31,672,151
----------- --------- ----------- ----------
Loss on impairment
of real estate
held-for-sale (4,898,295) - (4,898,295) -
Loss on operations
of real estate
held-for-sale (59,487) (219,634) (377,042) (390,547)
------- -------- -------- --------
Loss from
discontinued
operations (4,957,782) (219,634) (5,275,337) (390,547)
---------- -------- ---------- --------
Net (loss) income (44,076,268) 2,398,053 (78,324,924) 31,281,604
Net income (loss)
attributable to
noncontrolling
interest 58,694 (177,833) 18,620,771 4,272,921
------ -------- ---------- ---------
Net (loss) income
attributable to
Arbor Realty Trust,
Inc. $(44,134,962) $2,575,886 $(96,945,695) $27,008,683
============ ========== ============ ===========
Basic (loss)
earnings per
common share:
Net (loss) income
from continuing
operations, net of
noncontrolling
interest $(1.54) $0.11 $(3.62) $1.31
Loss from
discontinued
operations (0.20) (0.01) (0.21) (0.02)
----- ----- ----- -----
Net (loss) income
attributable to
Arbor Realty Trust,
Inc. $(1.74) $0.10 $(3.83) $1.29
====== ===== ====== =====
Diluted (loss)
earnings per
common share:
Net (loss) income
from continuing
operations, net of
noncontrolling
interest $(1.54) $0.11 $(3.62) $1.29
Loss from
discontinued
operations (0.20) (0.01) (0.21) (0.02)
----- ----- ----- -----
Net (loss) income
attributable to
Arbor Realty Trust,
Inc. $(1.74) $0.10 $(3.83) $1.27
====== ===== ====== =====
Dividends declared
per common share $- $0.62 $- $1.86
== ===== == =====
Weighted average number
of shares of common
stock outstanding:
Basic 25,387,410 24,990,710 25,288,692 22,166,518
========== ========== ========== ==========
Diluted 25,387,410 24,990,710 25,288,692 24,706,174
========== ========== ========== ==========
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2009 2008
---- ----
(Unaudited) (Audited)
Assets:
Cash and cash equivalents $27,264,044 $832,041
Restricted cash 39,705,681 93,219,133
Loans and investments, net 1,847,707,068 2,181,683,619
Available-for-sale securities, at fair
value 117,579 529,104
Securities held-to-maturity, net 68,547,038 58,244,348
Investment in equity affiliates 64,766,344 29,310,953
Real estate owned, net 8,411,013 46,478,994
Real estate held-for-sale, net 41,440,000 -
Due from related party - 2,933,344
Prepaid management fee - related party 26,340,397 26,340,397
Other assets 67,584,433 139,664,556
---------- -----------
Total assets $2,191,883,597 $2,579,236,489
============== ==============
Liabilities and Equity:
Repurchase agreements $3,308,333 $60,727,789
Collateralized debt obligations 1,102,576,530 1,152,289,000
Junior subordinated notes to subsidiary
trust issuing preferred securities 259,328,815 276,055,000
Notes payable 392,078,566 518,435,437
Notes payable-related party - 4,200,000
Mortgage note payable - held-for-sale 41,440,000 41,440,000
Due to related party 863,927 993,192
Due to borrowers 4,971,483 32,330,603
Deferred revenue 77,123,133 77,123,133
Other liabilities 87,245,401 134,647,667
---------- -----------
Total liabilities 1,968,936,188 2,298,241,821
------------- -------------
Commitments and contingencies - -
Equity:
Arbor Realty Trust, Inc. stockholders' equity:
Preferred stock, $0.01 par value:
100,000,000 shares authorized; no
shares issued or outstanding - -
Common stock, $0.01 par value:
500,000,000 shares authorized;
25,666,810 shares issued, 25,387,410
shares outstanding at September 30,
2009 and 25,421,810 shares issued,
25,142,410 shares outstanding at
December 31, 2008 256,668 254,218
Additional paid-in capital 450,376,782 447,321,186
Treasury stock, at cost - 279,400 shares (7,023,361) (7,023,361)
Accumulated deficit (159,892,614) (62,939,722)
Accumulated other comprehensive loss (62,768,226) (96,606,672)
----------- -----------
Total Arbor Realty Trust, Inc.
Stockholders' equity 220,949,249 281,005,649
----------- -----------
Noncontrolling interest in consolidated
entity 1,998,160 (10,981)
--------- -------
Total equity 222,947,409 280,994,668
----------- -----------
Total liabilities and equity $2,191,883,597 $2,579,236,489
============== ==============
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES - Continued
(Unaudited)
September 30, 2009
------------------
GAAP Arbor Realty Trust, Inc.
Stockholders' Equity $220,949,249
Add: 450 West 33rd Street transaction -
deferred revenue 77,123,133
Unrealized loss on derivative instruments 56,459,914
Subtract: 450 West 33rd Street transaction -
prepaid management fee (19,047,949)
-----------
Adjusted Arbor Realty Trust, Inc.
Stockholders' Equity $335,484,347
============
Adjusted book value per share $13.21
======
GAAP book value per share $8.70
=====
Common shares outstanding 25,387,410
==========
Given the magnitude and the deferral structure of the 450 West 33rd
Street transaction combined with the change in the fair value of certain
derivative instruments, Arbor has elected to report adjusted book value
per share for the affected period to currently reflect the future impact
of the 450 West 33rd Street transaction on the company's financial
condition as well as the evaluation of Arbor without the effects of
unrealized losses from certain of the Company's derivative instruments.
Management considers this non-GAAP financial measure to be an effective
indicator, for both management and investors, of Arbor's financial
performance. Arbor's management does not advocate that investors consider
this non-GAAP financial measure in isolation from, or as a substitute for,
financial information prepared in accordance with GAAP.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES - Continued
(Unaudited)
Quarter Ended Nine Months Ended
September 30, September 30,
------------- -------------
2009 2008 2009 2008
---- ---- ---- ----
Net (loss) income
attributable to
Arbor Realty Trust,
Inc., GAAP basis $(44,134,962) $2,575,886 $(96,945,695) $27,008,683
Add:
Noncontrolling
interest in
operating
partnership - - - 4,450,754
Depreciation -
real estate owned 120,878 256,370 686,922 427,283
Depreciation -
investment in equity
affiliates - 217,821 419,923 968,353
- ------- ------- -------
Funds from operations
("FFO") $(44,014,084) $3,050,077 $(95,838,850) $32,855,073
============ ========== ============ ===========
Diluted FFO per
common share $(1.73) $0.12 $(3.79) $1.33
====== ===== ====== =====
Diluted weighted
average shares
outstanding 25,387,410 24,990,710 25,288,692 24,706,174
========== ========== ========== ==========
Arbor is presenting funds from operations, or FFO, because management
believes it to be an important supplemental measure of the Company's
operating performance in that it is frequently used by analysts, investors
and other parties in the evaluation of real estate investment trusts
(REITs). The revised White Paper on FFO approved by the Board of
Governors of the National Association of Real Estate Investment Trusts, or
NAREIT, in April 2002 defines FFO as net income (loss) attributable to
Arbor Realty Trust, Inc. (computed in accordance with generally accepted
accounting principles (GAAP)), excluding gains (losses) from sales of
depreciated real properties, plus real estate related depreciation and
amortization and after adjustments for unconsolidated partnerships and
joint ventures. The Company considers gains and losses on the sales of
undepreciated real estate investments to be a normal part of its recurring
operating activities in accordance with GAAP and should not be excluded
when calculating FFO. To date, the Company has not sold any previously
depreciated operating properties, which would be excluded from the FFO
calculation. Losses from discontinued operations are not excluded when
calculating FFO.
FFO is not intended to be an indication of our cash flow from operating
activities (determined in accordance with GAAP) or a measure of our liquidity, nor is it entirely indicative of funding our cash needs,
including our ability to make cash distributions. Arbor's calculation of
FFO may be different from the calculation used by other companies and,
therefore, comparability may be limited.
Arbor Realty Trust, Inc.
Summary of Equity and Profit Interests
(all dollar amounts in thousands)
Unaudited
Initial ART Current Approximate
Investment Investment Cash Equity Square
Name Amount Date Investment Profit % Footage
---- ------ ---- ---------- -------- -------
80 Evergreen $384 3Q03 $201 12.50% 77,680
930 Flushing 1,126 3Q03 291 12.50% 304,080
450 W. 33rd St 1,500 4Q03 1,137 0.58%(1) 1,746,734 Toy Building 10,000 2Q05 5,720 10.00% 320,000 Homewood Mtn
Resort - 2Q06 - 25.60% 1,224(3)
Richland Terrace
Apartments - 3Q06 - 25.00% 342,152
Ashley Court
Apartments - 3Q06 - 25.00% 177,892
Nottingham
Village - 1Q07 - 25.00% 285,900
Extended Stay
Hotel Portfolio 115,000 (5) 2Q07 115,000 16.17% 684(4)
Alpine Meadows 13,220 3Q07 13,220 39.00% 2,163(3)
St. John's
Development 500 4Q07 1,884 50.00% 23(3)
Windrush Village
Apartments - 2Q08 445 25.00% 221,726
Current
Property Debt Balance
Name Type Location on Property Comments
---- ---- -------- ----------- --------
80 Evergreen Warehouse Brooklyn, NY $5,000 Property
refinanced
June 2008
930 Flushing Warehouse Brooklyn, NY 24,448 Property
refinanced
July 2005
450 W. 33rd St Office New York City 517,000
Toy Building Conversion New York City 343,400(2) Condo conversion
- investment
held in Taxable
REIT Subsidiary
("TRS")
Homewood Mtn
Resort Land Homewood, CA 114,157 Profits interest
held in TRS
Richland Terrace
Apartments Multi Family Columbia, SC 8,964
Ashley Court
Apartments Multi Family Fort Wayne, IN 5,452
Nottingham
Village Multi Family Indianapolis, IN 6,626
Extended Stay
Hotel Portfolio Hotel Multistate 7,400,000 Preferred return
of 12% on
equity
Alpine Meadows Land Alpine Meadows, 30,500 Preferred return
CA of 18% on
equity
St. John's
Development Land Jacksonville, FL 25,000
Windrush Village
Apartments Multi Family Tallahassee, FL 12,800
(1) Represents approximately 29% of the 2% retained interest in the
property. In addition, Arbor has approximately 29% of a 50% interest
in the property's air rights.
(2) Debt balance represents anticipated debt financing required to
complete condominium conversion project.
(3) Amount represents approximate acreage of property.
(4) Amount represents approximately 684 properties in 44 states and Canada
with approximately 76,000 rooms.
(5) As of September 30, 2009, the outstanding balance of this investment
was $14.3 million.
Contacts: Investors:
Arbor Realty Trust, Inc. Stephanie Carrington / Amy Glynn
Paul Elenio, Chief Financial Officer The Ruth Group
516-506-4422 646-536-7023
pelenio@arbor.com scarrington@theruthgroup.com
aglynn@theruthgroup.com
Media:
Bonnie Habyan, SVP of Marketing
516-506-4615
bhabyan@arbor.com
SOURCE Arbor Realty Trust, Inc.
Copyright 2009 PR Newswire
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