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EXCEL - IDEA: XBRL DOCUMENT - CBL & ASSOCIATES PROPERTIES INCFinancial_Report.xls
EX-32.3 - EXHIBIT 32.3 - CBL & ASSOCIATES PROPERTIES INCexhibit323-6302014.htm
EX-12.1 - EXHIBIT 12.1 - CBL & ASSOCIATES PROPERTIES INCexhibit-121x6302014.htm
EX-12.2 - EXHIBIT 12.2 - CBL & ASSOCIATES PROPERTIES INCexhibit-122x6302014.htm
EX-31.2 - EXHIBIT 31.2 - CBL & ASSOCIATES PROPERTIES INCexhibit-312x6302014.htm
EX-31.1 - EXHIBIT 31.1 - CBL & ASSOCIATES PROPERTIES INCexhibit-311x6302014.htm
EX-12.4 - EXHIBIT 12.4 - CBL & ASSOCIATES PROPERTIES INCexhibit-124x6302014.htm
EX-32.1 - EXHIBIT 32.1 - CBL & ASSOCIATES PROPERTIES INCexhibit-321x6302014.htm
EX-31.4 - EXHIBIT 31.4 - CBL & ASSOCIATES PROPERTIES INCexhibit-314x6302014.htm
EX-32.2 - EXHIBIT 32.2 - CBL & ASSOCIATES PROPERTIES INCexhibit322-6x30x2014.htm
EX-12.3 - EXHIBIT 12.3 - CBL & ASSOCIATES PROPERTIES INCexhibit-123x6302014.htm
EX-32.4 - EXHIBIT 32.4 - CBL & ASSOCIATES PROPERTIES INCexhibit-324x6302014.htm
EX-31.3 - EXHIBIT 31.3 - CBL & ASSOCIATES PROPERTIES INCexhibit-313x6302014.htm

UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
S QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2014
Or
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO _______________
 
COMMISSION FILE NO. 1-12494 (CBL & ASSOCIATES PROPERTIES, INC.)
COMMISSION FILE NO. 333-182515-01 (CBL & ASSOCIATES LIMITED PARTNERSHIP)
______________
CBL & ASSOCIATES PROPERTIES, INC.
CBL & ASSOCIATES LIMITED PARTNERSHIP
(Exact Name of registrant as specified in its charter)
______________
DELAWARE  (CBL & ASSOCIATES PROPERTIES, INC.)
 
   62-1545718
DELAWARE (CBL & ASSOCIATES LIMITED PARTNERSHIP)
 
   62-1542285
(State or other jurisdiction of incorporation or organization)     
 
 (I.R.S. Employer Identification Number)
                       
 2030 Hamilton Place Blvd., Suite 500, Chattanooga,  TN  37421-6000
(Address of principal executive office, including zip code)
423.855.0001
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. 
CBL & Associates Properties, Inc.
 
 Yes x   
No o
CBL & Associates Limited Partnership
 
 Yes x   
No o
                      
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
CBL & Associates Properties, Inc.
 
 Yes x   
No o
CBL & Associates Limited Partnership
 
 Yes x   
No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. 
CBL & Associates Properties, Inc.
Large accelerated filer x
Accelerated filer o
 Non-accelerated filer o 
Smaller Reporting Company o
CBL & Associates Limited Partnership
Large accelerated filer o
Accelerated filer o
Non-accelerated filer x
Smaller Reporting Company o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
CBL & Associates Properties, Inc.
 
 Yes o  
No x
CBL & Associates Limited Partnership
 
 Yes o  
No x
As of August 4, 2014, there were 170,262,947 shares of CBL & Associates Properties, Inc.'s common stock, par value $0.01 per share, outstanding.




EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the quarter ended June 30, 2014 of CBL & Associates Properties, Inc. and CBL & Associates Limited Partnership. Unless stated otherwise or the context otherwise requires, references to the "Company" mean CBL & Associates Properties, Inc. and its subsidiaries. References to the "Operating Partnership" mean CBL & Associates Limited Partnership and its subsidiaries. The terms "we," "us" and "our" refer to the Company or the Company and the Operating Partnership collectively, as the context requires.

The Company is a real estate investment trust ("REIT") whose stock is traded on the New York Stock Exchange. The Company is the 100% owner of two qualified REIT subsidiaries, CBL Holdings I, Inc. and CBL Holdings II, Inc. At June 30, 2014, CBL Holdings I, Inc., the sole general partner of the Operating Partnership, owned a 1.0% general partner interest in the Operating Partnership and CBL Holdings II, Inc. owned an 84.3% limited partner interest for a combined interest held by the Company of 85.3%.

As the sole general partner of the Operating Partnership, the Company's subsidiary, CBL Holdings I, Inc., has exclusive control of the Operating Partnership's activities. Management operates the Company and the Operating Partnership as one business. The management of the Company consists of the same individuals that manage the Operating Partnership. The Company's only material asset is its indirect ownership of partnership interests of the Operating Partnership. As a result, the Company conducts substantially all its business through the Operating Partnership as described in the preceding paragraph. The Company also issues public equity from time to time and guarantees certain debt of the Operating Partnership. The Operating Partnership holds all of the assets and indebtedness of the Company and, through affiliates, retains the ownership interests in the Company's joint ventures. Except for the net proceeds of offerings of equity by the Company, which are contributed to the Operating Partnership in exchange for partnership units on a one-for-one basis, the Operating Partnership generates all remaining capital required by the Company's business through its operations and its incurrence of indebtedness.

We believe that combining the two quarterly reports on Form 10-Q for the Company and the Operating Partnership provides the following benefits:

enhances investors' understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner that management views and operates the business;

eliminates duplicative disclosure and provides a more streamlined and readable presentation, since a substantial portion of the disclosure applies to both the Company and the Operating Partnership; and

creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

To help investors understand the differences between the Company and the Operating Partnership, this report provides separate condensed consolidated financial statements for the Company and the Operating Partnership. Noncontrolling interests, shareholders' equity and partners' capital are the main areas of difference between the condensed consolidated financial statements of the Company and those of the Operating Partnership. A single set of notes to condensed consolidated financial statements is presented that includes separate discussions for the Company and the Operating Partnership, when applicable. A combined Management's Discussion and Analysis of Financial Condition and Results of Operations section is also included that presents combined information and discrete information related to each entity, as applicable.

In order to highlight the differences between the Company and the Operating Partnership, this report includes the following sections that provide separate financial information for the Company and the Operating Partnership:

condensed consolidated financial statements;

certain accompanying notes to condensed consolidated financial statements, including Note 5 - Unconsolidated Affiliates, Redeemable Interests, Noncontrolling Interests and Cost Method Investments; Note 6 - Mortgage and Other Indebtedness; Note 7 - Comprehensive Income; and Note 11 - Earnings Per Share and Earnings Per Unit;

controls and procedures in Item 4 of Management's Discussion and Analysis; and

certifications of the Chief Executive Officer and Chief Financial Officer included as Exhibits 31.1 through 32.4.



CBL & Associates Properties, Inc.
CBL & Associates Limited Partnership
Table of Contents
PART I
FINANCIAL INFORMATION
 
 
 
CBL & Associates Properties, Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2014 and 2013
 
 
 
CBL & Associates Limited Partnership
 
 
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidated Statements of Capital for the Six Months Ended June 30, 2014 and 2013
 
 
 
 
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2014 and 2013
 
 
 
CBL & Associates Properties, Inc. and CBL & Associates Limited Partnership
 
Management's Discussion and Analysis of Financial Condition and Results of Operations
 
 
 
 
 
 
 
 
 
 



PART I – FINANCIAL INFORMATION

ITEM 1:   Financial Statements

CBL & Associates Properties, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)
ASSETS
June 30,
2014
 
December 31,
2013
Real estate assets:
 
 
 
Land
$
852,963

 
$
858,619

Buildings and improvements
7,085,523

 
7,125,512

 
7,938,486

 
7,984,131

Accumulated depreciation
(2,126,434
)
 
(2,056,357
)
 
5,812,052

 
5,927,774

Developments in progress
185,906

 
139,383

Net investment in real estate assets
5,997,958

 
6,067,157

Cash and cash equivalents
63,482

 
65,500

Receivables:
 
 
 
 Tenant, net of allowance for doubtful accounts of $2,380
     and $2,379 in 2014 and 2013, respectively
76,468

 
79,899

 Other, net of allowance for doubtful accounts of $1,120
      and $1,241 in 2014 and 2013, respectively
22,108

 
23,343

Mortgage and other notes receivable
40,137

 
30,424

Investments in unconsolidated affiliates
271,868

 
277,146

Intangible lease assets and other assets
229,493

 
242,502

 
$
6,701,514

 
$
6,785,971

 
 
 
 
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
 

 
 

Mortgage and other indebtedness
$
4,810,811

 
$
4,857,523

Accounts payable and accrued liabilities
315,298

 
333,875

Total liabilities
5,126,109

 
5,191,398

Commitments and contingencies (Note 12)


 


Redeemable noncontrolling interests
36,540

 
34,639

Shareholders' equity:
 
 
 
Preferred stock, $.01 par value, 15,000,000 shares authorized:
 
 
 
 7.375% Series D Cumulative Redeemable Preferred
     Stock, 1,815,000 shares outstanding
18

 
18

 6.625% Series E Cumulative Redeemable Preferred
     Stock, 690,000 shares outstanding
7

 
7

 Common stock, $.01 par value, 350,000,000 shares
     authorized, 170,260,769 and 170,048,144 issued and
     outstanding in 2014 and 2013, respectively
1,703

 
1,700

Additional paid-in capital
1,962,103

 
1,967,644

Accumulated other comprehensive income
9,659

 
6,325

Dividends in excess of cumulative earnings
(583,405
)
 
(570,781
)
Total shareholders' equity
1,390,085

 
1,404,913

Noncontrolling interests
148,780

 
155,021

Total equity
1,538,865

 
1,559,934

 
$
6,701,514

 
$
6,785,971


The accompanying notes are an integral part of these condensed consolidated statements.

1


CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2014
 
2013
 
2014
 
2013
REVENUES:
 
 
 
 
 
 
 
Minimum rents
$
167,631

 
$
165,512

 
$
336,908

 
$
330,930

Percentage rents
1,824

 
2,335

 
5,430

 
7,051

Other rents
4,613

 
4,521

 
9,895

 
9,665

Tenant reimbursements
70,774

 
70,666

 
142,992

 
142,948

Management, development and leasing fees
2,813

 
2,850

 
5,948

 
5,925

Other
9,278

 
9,701

 
17,003

 
17,548

Total revenues
256,933

 
255,585

 
518,176

 
514,067

 
 
 
 
 
 
 
 
OPERATING EXPENSES:
 

 
 

 
 
 
 
Property operating
35,527

 
33,663

 
75,538

 
72,796

Depreciation and amortization
70,609

 
68,117

 
139,692

 
137,173

Real estate taxes
22,089

 
21,389

 
43,436

 
43,805

Maintenance and repairs
12,623

 
13,229

 
28,788

 
27,419

General and administrative
11,336

 
12,876

 
26,109

 
26,300

Loss on impairment
106

 
21,038

 
17,256

 
21,038

Other
7,390

 
8,191

 
13,935

 
14,847

Total operating expenses
159,680

 
178,503

 
344,754

 
343,378

Income from operations
97,253

 
77,082

 
173,422

 
170,689

Interest and other income
1,544

 
661

 
3,072

 
1,388

Interest expense
(59,277
)
 
(57,209
)
 
(119,783
)
 
(117,033
)
Gain (loss) on extinguishment of debt

 
(9,108
)
 
42,660

 
(9,108
)
Gain on sales of real estate assets
1,925

 
457

 
3,079

 
1,000

Gain on investment

 
2,400

 

 
2,400

Equity in earnings of unconsolidated affiliates
3,418

 
2,729

 
7,102

 
5,348

Income tax provision
(786
)
 
(757
)
 
(1,183
)
 
(583
)
Income from continuing operations
44,077

 
16,255

 
108,369

 
54,101

Operating income (loss) of discontinued operations
(59
)
 
1,893

 
(558
)
 
3,151

Gain on discontinued operations
107

 
91

 
90

 
872

Net income
44,125

 
18,239

 
107,901

 
58,124

Net income attributable to noncontrolling interests in:
 

 
 

 
 
 
 
Operating Partnership
(4,620
)
 
(36
)
 
(12,271
)
 
(3,527
)
Other consolidated subsidiaries
(1,547
)
 
(6,479
)
 
(2,378
)
 
(12,560
)
Net income attributable to the Company
37,958

 
11,724

 
93,252

 
42,037

Preferred dividends
(11,223
)
 
(11,223
)
 
(22,446
)
 
(22,446
)
Net income attributable to common shareholders
$
26,735

 
$
501

 
$
70,806

 
$
19,591


2


CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
(Continued)

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2014
 
2013
 
2014
 
2013
Basic and diluted per share data attributable to common shareholders:
 
 

 
 
 
 
Income (loss) from continuing operations, net of preferred dividends
$
0.16

 
$
(0.01
)
 
$
0.42

 
$
0.10

Discontinued operations
0.00

 
0.01

 
0.00

 
0.02

Net income attributable to common shareholders
$
0.16

 
$
0.00

 
$
0.42

 
$
0.12

Weighted-average common and potential dilutive common shares outstanding
170,267

 
166,607

 
170,232

 
164,088

 
 
 
 
 
 
 
 
Amounts attributable to common shareholders:
 

 
 

 
 
 
 
Income (loss) from continuing operations, net of preferred dividends
$
26,694

 
$
(1,184
)
 
$
71,205

 
$
16,181

Discontinued operations
41

 
1,685

 
(399
)
 
3,410

Net income attributable to common shareholders
$
26,735

 
$
501

 
$
70,806

 
$
19,591

 
 
 
 
 
 
 
 
Dividends declared per common share
$
0.245

 
$
0.230

 
$
0.490

 
$
0.460




The accompanying notes are an integral part of these condensed consolidated statements.


3


CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Comprehensive Income
(In thousands)
(Unaudited)

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2014
 
2013
 
2014
 
2013
Net income
$
44,125

 
$
18,239

 
$
107,901

 
$
58,124

 
 
 
 
 
 
 
 
Other comprehensive income (loss):
 
 
 
 
 
 
 
Unrealized holding gain (loss) on available-for-sale securities
1,195

 
(1,015
)
 
2,196

 
(252
)
   Unrealized gain on hedging instruments
921

 
443

 
1,873

 
163

   Reclassification of hedging effect on earnings
(551
)
 
562

 
(1,099
)
 
1,119

Total other comprehensive income (loss)
1,565

 
(10
)
 
2,970

 
1,030

 
 
 
 
 
 
 
 
Comprehensive income
45,690

 
18,229

 
110,871

 
59,154

Comprehensive income attributable to noncontrolling interests in:
 
 
 
 
 
 
 
Operating Partnership
(4,280
)
 
(21
)
 
(11,907
)
 
(3,688
)
Other consolidated subsidiaries
(1,547
)
 
(6,479
)
 
(2,378
)
 
(12,560
)
Comprehensive income attributable to the Company
$
39,863

 
$
11,729

 
$
96,586

 
$
42,906


The accompanying notes are an integral part of these condensed consolidated statements.


4


CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Equity
(In thousands, except share data)
 (Unaudited)
 
 
 
Equity
 
 
 
Shareholders' Equity
 
 
 
 
 
Redeemable
Noncontrolling
Interests
 
Preferred
 Stock
 
Common
 Stock
 
Additional
 Paid-in
 Capital
 
Accumulated
 Other
 Comprehensive
 Income
 
Dividends in Excess of Cumulative Earnings
 
Total
Shareholders'
Equity
 
Noncontrolling Interests
 
Total
 Equity
Balance, January 1, 2013
$
40,248

 
$
25

 
$
1,613

 
$
1,773,630

 
$
6,986

 
$
(453,561
)
 
$
1,328,693

 
$
192,404

 
$
1,521,097

Net income
1,996

 

 

 

 

 
42,037

 
42,037

 
3,863

 
45,900

Other comprehensive income
10

 

 

 

 
869

 

 
869

 
151

 
1,020

Dividends declared - common stock

 

 

 

 

 
(76,791
)
 
(76,791
)
 

 
(76,791
)
Dividends declared - preferred stock

 

 

 

 

 
(22,446
)
 
(22,446
)
 

 
(22,446
)
Issuances of 8,632,742 shares of common stock
     and restricted common stock

 

 
86

 
209,420

 

 

 
209,506

 

 
209,506

Cancellation of 35,865 shares of restricted
     common stock

 

 

 
(705
)
 

 

 
(705
)
 

 
(705
)
Amortization of deferred compensation

 

 

 
1,887

 

 

 
1,887

 

 
1,887

Distributions to noncontrolling interests
(3,838
)
 

 

 

 

 

 

 
(15,368
)
 
(15,368
)
Adjustment for noncontrolling interests
2,909

 

 

 
(29,057
)
 

 

 
(29,057
)
 
26,148

 
(2,909
)
Adjustment to record redeemable
     noncontrolling interests at redemption value
(854
)
 

 

 
815

 

 

 
815

 
39

 
854

Acquire controlling interest in shopping center property

 

 

 

 

 

 

 
(41,444
)
 
(41,444
)
Balance, June 30, 2013
$
40,471

 
$
25

 
$
1,699

 
$
1,955,990

 
$
7,855

 
$
(510,761
)
 
$
1,454,808

 
$
165,793

 
$
1,620,601





5


CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Equity
(In thousands, except share data)
(Unaudited)
(Continued)
 
 
 
Equity
 
 
 
Shareholders' Equity
 
 
 
 
 
Redeemable
Noncontrolling
Interests
 
Preferred
 Stock
 
Common
 Stock
 
Additional
 Paid-in
 Capital
 
Accumulated
Other
Comprehensive
Income
 
Dividends in Excess of Cumulative Earnings
 
Total
Shareholders'
Equity
 
Noncontrolling
 Interests
 
Total
 Equity
Balance, January 1, 2014
$
34,639

 
$
25

 
$
1,700

 
$
1,967,644

 
$
6,325

 
$
(570,781
)
 
$
1,404,913

 
$
155,021

 
$
1,559,934

Net income
2,355

 

 

 

 

 
93,252

 
93,252

 
12,294

 
105,546

Other comprehensive income (loss)
24

 

 

 

 
3,334

 

 
3,334

 
(388
)
 
2,946

Dividends declared - common stock

 

 

 

 

 
(83,430
)
 
(83,430
)
 

 
(83,430
)
Dividends declared - preferred stock

 

 

 

 

 
(22,446
)
 
(22,446
)
 

 
(22,446
)
Issuances of 241,188 shares of common stock
     and restricted common stock

 

 
3

 
587

 

 

 
590

 

 
590

Cancellation of 28,563 shares of restricted
     common stock

 

 

 
(360
)
 

 

 
(360
)
 

 
(360
)
Amortization of deferred compensation

 

 

 
2,115

 

 

 
2,115

 

 
2,115

Redemption of Operating Partnership common units

 

 

 

 

 

 

 
(2,914
)
 
(2,914
)
Distributions to noncontrolling interests
(5,744
)
 

 

 

 

 

 

 
(17,850
)
 
(17,850
)
Adjustment for noncontrolling interests
1,482

 

 

 
(4,347
)
 

 

 
(4,347
)
 
2,865

 
(1,482
)
Adjustment to record redeemable
     noncontrolling interests at redemption value
3,784

 

 

 
(3,536
)
 

 

 
(3,536
)
 
(248
)
 
(3,784
)
Balance, June 30, 2014
$
36,540

 
$
25

 
$
1,703

 
$
1,962,103

 
$
9,659

 
$
(583,405
)
 
$
1,390,085

 
$
148,780

 
$
1,538,865


The accompanying notes are an integral part of these condensed consolidated statements.


6



CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

 
Six Months Ended
June 30,
 
2014
 
2013
CASH FLOWS FROM OPERATING ACTIVITIES:
 

 
 
Net income
$
107,901

 
$
58,124

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 

Depreciation and amortization
139,692

 
142,177

Net amortization of deferred finance costs and debt premiums
3,357

 
2,503

Net amortization of intangible lease assets and liabilities
267

 
(180
)
Gain on sales of real estate assets
(3,079
)
 
(1,000
)
Gain on investment

 
(2,400
)
Gain on discontinued operations
(90
)
 
(872
)
Write-off of development projects
34

 
1

Share-based compensation expense
2,605

 
1,887

Loss on impairment
17,256

 
21,038

Loss on impairment from discontinued operations
681

 

(Gain) loss on extinguishment of debt
(42,660
)
 
9,108

Equity in earnings of unconsolidated affiliates
(7,102
)
 
(5,348
)
Distributions of earnings from unconsolidated affiliates
8,965

 
7,911

Provision for doubtful accounts
1,912

 
927

Change in deferred tax accounts
316

 
1,824

Changes in:
 

 
 

Tenant and other receivables
2,274

 
(5,796
)
Other assets
(1,461
)
 
5,173

Accounts payable and accrued liabilities
(24,752
)
 
(45,408
)
Net cash provided by operating activities
206,116

 
189,669

 
 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES:
 

 
 

Additions to real estate assets
(114,510
)
 
(147,327
)
Acquisition of real estate assets

 
(26,444
)
(Additions) reductions to restricted cash
3,393

 
(528
)
Proceeds from sales of real estate assets
10,298

 
45,039

Additions to mortgage and other notes receivable

 
(2,700
)
Payments received on mortgage and other notes receivable
287

 
3,699

Proceeds from sales of investments and available-for-sale securities

 
15,877

Additional investments in and advances to unconsolidated affiliates
(8,229
)
 
(29,079
)
Distributions in excess of equity in earnings of unconsolidated affiliates
14,713

 
4,239

Changes in other assets
(3,167
)
 
(11,677
)
Net cash used in investing activities
(97,215
)
 
(148,901
)

7


CBL & Associates Properties, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
(Continued)

 
Six Months Ended
June 30,
 
2014
 
2013
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
Proceeds from mortgage and other indebtedness
$
379,619

 
$
752,835

Principal payments on mortgage and other indebtedness
(356,918
)
 
(882,239
)
Additions to deferred financing costs
(113
)
 
(900
)
Prepayment fees on extinguishment of debt
(1,249
)
 
(8,708
)
Proceeds from issuances of common stock
82

 
209,506

Purchase of noncontrolling interest in the Operating Partnership
(2,914
)
 

Distributions to noncontrolling interests
(23,603
)
 
(29,437
)
Dividends paid to holders of preferred stock
(22,446
)
 
(22,446
)
Dividends paid to common shareholders
(83,377
)
 
(73,197
)
Net cash used in financing activities
(110,919
)
 
(54,586
)
 
 
 
 
NET CHANGE IN CASH AND CASH EQUIVALENTS
(2,018
)
 
(13,818
)
CASH AND CASH EQUIVALENTS, beginning of period
65,500

 
78,248

CASH AND CASH EQUIVALENTS, end of period
$
63,482

 
$
64,430

 
 
 
 
SUPPLEMENTAL INFORMATION:
 

 
 

Cash paid for interest, net of amounts capitalized
$
117,004

 
$
114,360


 
The accompanying notes are an integral part of these condensed consolidated statements.


8


CBL & Associates Limited Partnership
Condensed Consolidated Balance Sheets
(In thousands, except unit data)
(Unaudited)
ASSETS
June 30,
2014
 
December 31,
2013
Real estate assets:
 
 
 
Land
$
852,963

 
$
858,619

Buildings and improvements
7,085,523

 
7,125,512

 
7,938,486

 
7,984,131

Accumulated depreciation
(2,126,434
)
 
(2,056,357
)
 
5,812,052

 
5,927,774

Developments in progress
185,906

 
139,383

Net investment in real estate assets
5,997,958

 
6,067,157

Cash and cash equivalents
63,461

 
65,486

Receivables:
 

 
 

 Tenant, net of allowance for doubtful accounts of $2,380
     and $2,379 in 2014 and 2013, respectively
76,468

 
79,899

 Other, net of allowance for doubtful accounts of $1,120
      and $1,241 in 2014 and 2013, respectively
22,108

 
23,343

Mortgage and other notes receivable
40,137

 
30,424

Investments in unconsolidated affiliates
272,426

 
277,701

Intangible lease assets and other assets
229,374

 
242,383

 
$
6,701,932

 
$
6,786,393

 
 
 
 
 
 
 
 
LIABILITIES, REDEEMABLE INTERESTS AND CAPITAL
 

 
 

Mortgage and other indebtedness
$
4,810,811

 
$
4,857,523

Accounts payable and accrued liabilities
315,283

 
333,876

Total liabilities
5,126,094

 
5,191,399

Commitments and contingencies (Note 12)


 


Redeemable interests:  
 

 
 

Redeemable noncontrolling interests  
6,136

 
5,883

Redeemable common units  
30,404

 
28,756

Total redeemable interests
36,540

 
34,639

Partners' capital:
 

 
 

Preferred units
565,212

 
565,212

Common units:
 
 
 
 General partner
9,636

 
9,866

 Limited partners
939,186

 
961,175

Accumulated other comprehensive income
7,869

 
4,923

Total partners' capital
1,521,903

 
1,541,176

Noncontrolling interests
17,395

 
19,179

Total capital
1,539,298

 
1,560,355

 
$
6,701,932

 
$
6,786,393


The accompanying notes are an integral part of these condensed consolidated statements.


9



CBL & Associates Limited Partnership
Condensed Consolidated Statements of Operations
(In thousands, except per unit data)
(Unaudited)

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2014
 
2013
 
2014
 
2013
REVENUES:
 
 
 
 
 
 
 
Minimum rents
$
167,631

 
$
165,512

 
$
336,908

 
$
330,930

Percentage rents
1,824

 
2,335

 
5,430

 
7,051

Other rents
4,613

 
4,521

 
9,895

 
9,665

Tenant reimbursements
70,774

 
70,666

 
142,992

 
142,948

Management, development and leasing fees
2,813

 
2,850

 
5,948

 
5,925

Other
9,278

 
9,701

 
17,003

 
17,548

Total revenues
256,933

 
255,585

 
518,176

 
514,067

 
 
 
 
 
 
 
 
OPERATING EXPENSES:
 

 
 

 
 
 
 
Property operating
35,527

 
33,663

 
75,538

 
72,796

Depreciation and amortization
70,609

 
68,117

 
139,692

 
137,173

Real estate taxes
22,089

 
21,389

 
43,436

 
43,805

Maintenance and repairs
12,623

 
13,229

 
28,788

 
27,419

General and administrative
11,336

 
12,876

 
26,109

 
26,300

Loss on impairment
106

 
21,038

 
17,256

 
21,038

Other
7,390

 
8,191

 
13,935

 
14,847

Total operating expenses
159,680

 
178,503

 
344,754

 
343,378

Income from operations
97,253

 
77,082

 
173,422

 
170,689

Interest and other income
1,544

 
661

 
3,072

 
1,388

Interest expense
(59,277
)
 
(57,209
)
 
(119,783
)
 
(117,033
)
Gain (loss) on extinguishment of debt

 
(9,108
)
 
42,660

 
(9,108
)
Gain on sales of real estate assets
1,925

 
457

 
3,079

 
1,000

Gain on investment

 
2,400

 

 
2,400

Equity in earnings of unconsolidated affiliates
3,418

 
2,729

 
7,102

 
5,348

Income tax provision
(786
)
 
(757
)
 
(1,183
)
 
(583
)
Income from continuing operations
44,077

 
16,255

 
108,369

 
54,101

Operating income (loss) of discontinued operations
(59
)
 
1,893

 
(558
)
 
3,151

Gain on discontinued operations
107

 
91

 
90

 
872

Net income
44,125

 
18,239

 
107,901

 
58,124

Net income attributable to noncontrolling interests
(1,547
)
 
(6,479
)
 
(2,378
)
 
(12,560
)
Net income attributable to the Operating Partnership
42,578

 
11,760

 
105,523

 
45,564

Distributions to preferred unitholders
(11,223
)
 
(11,223
)
 
(22,446
)
 
(22,446
)
Net income attributable to common unitholders
$
31,355

 
$
537

 
$
83,077

 
$
23,118


10


CBL & Associates Limited Partnership
Condensed Consolidated Statements of Operations
(In thousands, except per unit data)
(Unaudited)
(Continued)

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
Basic and diluted per unit data attributable to common unitholders:
 
 

 
 
 
 
Income from continuing operations, net of preferred distributions
$
0.16

 
$
(0.01
)
 
$
0.42

 
$
0.10

Discontinued operations
0.00

 
0.01

 
0.00

 
0.02

Net income attributable to common unitholders
$
0.16

 
$
0.00

 
$
0.42

 
$
0.12

Weighted-average common and potential dilutive common units outstanding
199,726

 
196,153

 
199,734

 
193,633

 
 
 
 
 
 
 
 
Amounts attributable to common unitholders:
 

 
 

 
 
 
 
Income (loss) from continuing operations, net of preferred distributions
$
31,314

 
$
(1,148
)
 
$
83,476

 
$
19,708

Discontinued operations
41

 
1,685

 
(399
)
 
3,410

Net income attributable to common unitholders
$
31,355

 
$
537

 
$
83,077

 
$
23,118

 
 
 
 
 
 
 
 
Distributions declared per common unit
$
0.253

 
$
0.239

 
$
0.506

 
$
0.478






The accompanying notes are an integral part of these condensed consolidated statements.


11


CBL & Associates Limited Partnership
Condensed Consolidated Statements of Comprehensive Income
(In thousands)
(Unaudited)

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2014
 
2013
 
2014
 
2013
Net income
$
44,125

 
$
18,239

 
$
107,901

 
$
58,124

 
 
 
 
 
 
 
 
Other comprehensive income:
 
 
 
 
 
 
 
Unrealized holding gain (loss) on available-for-sale securities
1,193

 
(1,015
)
 
2,196

 
(252
)
   Unrealized gain on hedging instruments
921

 
443

 
1,873

 
163

Reclassification of hedging effect on earnings
(551
)
 
562

 
(1,099
)
 
1,119

Total other comprehensive income (loss)
1,563

 
(10
)
 
2,970

 
1,030

 
 
 
 
 
 
 
 
Comprehensive income
45,688

 
18,229

 
110,871

 
59,154

Comprehensive income attributable to noncontrolling interests
(1,547
)
 
(6,479
)
 
(2,378
)
 
(12,560
)
Comprehensive income of the Operating Partnership
$
44,141

 
$
11,750

 
$
108,493

 
$
46,594


The accompanying notes are an integral part of these condensed consolidated statements.


12


CBL & Associates Limited Partnership
Condensed Consolidated Statements of Capital
(in thousands)
 (Unaudited)
 
Redeemable Interests
 
Number of
 
 
 
Common Units
 
 
 
 
 
 
 
 
 
Redeemable Noncontrolling Interests
 
Redeemable Common Units
 
Total Redeemable
Interests
 
Preferred
Units
 
Common
Units
 
Preferred
Units
 
General
Partner
 
Limited
Partners
 
Accumulated
Other
Comprehensive Income
 
Total Partners' Capital
 
Noncontrolling Interests
 
Total Capital
Balance, January 1, 2013
$
6,413

 
$
33,835

 
$
40,248

 
25,050

 
190,855

 
$
565,212

 
$
9,904

 
$
877,363

 
$
5,685

 
$
1,458,164

 
$
63,496

 
$
1,521,660

Net income
1,809

 
187

 
1,996

 

 

 
22,446

 
240

 
22,481

 

 
45,167

 
733

 
45,900

Other comprehensive income

 
10

 
10

 

 

 

 

 

 
1,020

 
1,020

 

 
1,020

Distributions declared - common units

 
(2,288
)
 
(2,288
)
 

 

 

 
(966
)
 
(90,615
)
 

 
(91,581
)
 

 
(91,581
)
Distributions declared - preferred units

 

 

 

 

 
(22,446
)
 

 


 

 
(22,446
)
 

 
(22,446
)
Issuances of common units

 

 

 

 
8,633

 

 

 
209,506

 

 
209,506

 

 
209,506

Cancellation of restricted common stock

 

 

 

 
(36
)
 

 

 
(705
)
 

 
(705
)
 

 
(705
)
Amortization of deferred compensation

 
15

 
15

 

 

 

 
20

 
1,852

 

 
1,872

 

 
1,872

Distributions to noncontrolling interests
(1,550
)
 

 
(1,550
)
 

 

 

 

 

 

 

 
(1,035
)
 
(1,035
)
Allocation of partners' capital

 
2,894

 
2,894

 

 

 

 
1,709

 
(4,603
)
 

 
(2,894
)
 

 
(2,894
)
Adjustment to record redeemable
     interests at redemption value
(410
)
 
(444
)
 
(854
)
 

 

 

 
9

 
845

 

 
854

 

 
854

Acquire controlling interest in shopping
center properties

 

 

 

 

 

 

 

 

 

 
(41,444
)
 
(41,444
)
Balance, June 30, 2013
$
6,262

 
$
34,209

 
$
40,471

 
25,050

 
199,452

 
$
565,212

 
$
10,916

 
$
1,016,124

 
$
6,705

 
$
1,598,957

 
$
21,750

 
$
1,620,707





13


CBL & Associates Limited Partnership
Condensed Consolidated Statements of Capital
(in thousands)
(Unaudited)
(Continued)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Redeemable Interests
 
Number of
 
 
 
Common Units
 
 
 
 
 
 
 
 
 
Redeemable Noncontrolling Interests
 
Redeemable Common Units
 
Total Redeemable
Interests
 
Preferred
Units
 
Common
Units
 
Preferred
Units
 
General
Partner
 
Limited
Partners
 
Accumulated
Other
Comprehensive Income
 
Total Partners' Capital
 
Noncontrolling Interests
 
Total Capital
Balance, January 1, 2014
$
5,883

 
$
28,756

 
$
34,639

 
25,050

 
199,593

 
$
565,212

 
$
9,866

 
$
961,175

 
$
4,923

 
$
1,541,176

 
$
19,179

 
$
1,560,355

Net income
1,706

 
649

 
2,355

 

 

 
22,446

 
846

 
81,582

 

 
104,874

 
672

 
105,546

Other comprehensive income

 
24

 
24

 

 

 

 

 

 
2,946

 
2,946

 

 
2,946

Distributions declared - common units

 
(2,286
)
 
(2,286
)
 

 

 

 
(986
)
 
(97,839
)
 

 
(98,825
)
 

 
(98,825
)
Distributions declared - preferred units

 

 

 

 

 
(22,446
)
 

 

 

 
(22,446
)
 

 
(22,446
)
Issuances of common units

 

 

 

 
242

 

 

 
590

 

 
590

 

 
590

Redemption of common units

 

 

 

 
(171
)