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Section 1: 8-K (8-K)

Document


UNITED STATES
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
 
Date of report (Date of earliest event reported):  February 7, 2019
 

CBL & ASSOCIATES PROPERTIES, INC.

CBL & ASSOCIATES LIMITED PARTNERSHIP

(Exact Name of Registrant as Specified in its Charter)
 
 
 
 
 
 
 
Delaware
 
1-12494
 
62-1545718
Delaware
 
333-182515-01
 
62-1542285
(State or Other Jurisdiction of
Incorporation or Organization)
 
(Commission File
 Number)
 
(I.R.S. Employer Identification No.)
 
 
 
 
 
2030 Hamilton Place Blvd., Suite 500, Chattanooga, TN 37421
(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)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2).
Emerging growth company o    

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o





ITEM 2.02 Results of Operations and Financial Condition

On February 7, 2019, CBL & Associates Properties, Inc. (the "Company") reported its results for the fourth quarter and year ended December 31, 2018. The Company's earnings release and supplemental financial and operating information for the fourth quarter ended December 31, 2018 is attached as Exhibit 99.1. On February 8, 2019, the Company held a conference call to discuss the results for the fourth quarter and year ended December 31, 2018. The conference call script is attached as Exhibit 99.2.

The information in this Form 8-K and the Exhibits attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

ITEM 9.01 Financial Statements and Exhibits

(a)
Financial Statements of Businesses Acquired
Not applicable

(b)
Pro Forma Financial Information
Not applicable

(c)
Shell Company Transactions
Not applicable

(d)
Exhibits
 
 
 
 
Exhibit
Number
 
Description
 
 





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.

CBL & ASSOCIATES PROPERTIES, INC.
 
 
/s/ Farzana Khaleel
Farzana Khaleel
Executive Vice President -
Chief Financial Officer and Treasurer
 
 
CBL & ASSOCIATES LIMITED PARTNERSHIP
 
 
By: CBL HOLDINGS I, INC., its general partner
 
 
/s/ Farzana Khaleel
Farzana Khaleel
Executive Vice President -
Chief Financial Officer and Treasurer

                          



Date: February 8, 2019



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
Exhibit 99.1










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Earnings Release and
Supplemental Financial and Operating Information

For the Three Months and Year Ended
December 31, 2018



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Earnings Release and Supplemental Financial and Operating Information
Table of Contents

 
 
Page
Earnings Release
 
 
 
 
Consolidated Statements of Operations
 
 
 
 
Reconciliations of Supplementary Non-GAAP Financial Measures:
 
 
     Funds from Operations (FFO)
 
     Same-center Net Operating Income (NOI)
 
 
 
 
Selected Financial and Equity Information
 
 
 
 
Consolidated Balance Sheets
 
 
 
 
Condensed Combined Financial Statements - Unconsolidated Affiliates
 
 
 
 
Ratio of Adjusted EBITDAre to Interest Expense and Reconciliation of Adjusted EBITDAre to Operating Cash Flows
 
 
 
 
Schedule of Mortgage and Other Indebtedness
 
 
 
 
Schedule of Maturities and Unsecured Debt Covenant Compliance Ratios
 
 
 
 
Unencumbered Consolidated Portfolio Statistics
 
 
 
 
Mall Portfolio Statistics
 
 
 
 
Leasing Activity and Average Annual Base Rents
 
 
 
 
Top 25 Tenants Based on Percentage of Total Annual Revenues
 
 
 
 
Capital Expenditures
 
 
 
 
Development Activity
 
 
 
 
CBL Core Portfolio Exposure to Sears and Closed Bon-Ton Locations and Redevelopment Plans
 


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Contact: Katie Reinsmidt, EVP - Chief Investment Officer, 423.490.8301, katie.reinsmidt@cblproperties.com
CBL & ASSOCIATES PROPERTIES REPORTS RESULTS FOR FOURTH QUARTER AND FULL-YEAR 2018

CHATTANOOGA, Tenn. (February 7, 2019) – CBL & Associates Properties, Inc. (NYSE:CBL) announced results for the fourth quarter and year ended December 31, 2018. A description of each non-GAAP financial measure and the related reconciliation to the comparable GAAP financial measure is located at the end of this news release.
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
%
 
2018
 
2017
 
%
Net income (loss) attributable to common shareholders per diluted share
$
(0.39
)
 
$
0.15

 
(360.0
)%
 
$
(0.73
)
 
$
0.44

 
(265.9
)%
Funds from Operations ("FFO") per diluted share
$
0.44

 
$
0.55

 
(20.0
)%
 
$
1.70

 
$
2.18

 
(22.0
)%
FFO, as adjusted, per diluted share (1)
$
0.45

 
$
0.56

 
(19.6
)%
 
$
1.73

 
$
2.08

 
(16.8
)%
(1) For a reconciliation of FFO to FFO, as adjusted, for the periods presented, please refer to the footnotes to the Company's reconciliation of net income attributable to common shareholders to FFO allocable to Operating Partnership common unitholders on page 10 of this earnings release.

KEY TAKEAWAYS:
•
In January 2019, CBL announced a new $1.185 billion secured credit facility maturing in July 2023.
•
In 2018, CBL completed more than $340 million of financing activity.
•
In 2018, CBL completed gross asset sales of more than $100 million, including a tier 3 mall and approximately $35 million in outparcel.
•
FFO per diluted share, as adjusted, was $0.45 in the fourth quarter 2018 compared to $0.56 in the prior year period. Major items impacting fourth quarter 2018 FFO, as adjusted, include approximately $0.01 per share of dilution from asset sales, $0.07 per share lower property net operating income primarily due to retailer and anchor bankruptcies, $0.01 per share higher net interest expense and $0.02 per share due to lower gains on outparcel sales.
•
FFO per diluted share, as adjusted, was $1.73 for 2018, compared with $2.08 in the prior-year period. Major items impacting 2018 FFO, as adjusted, include approximately $0.08 per share of dilution from asset sales and non-core properties, $0.20 per share lower property net operating income primarily due to retailer and anchor bankruptcies, $0.02 per share of higher G&A expense substantially related to one-time severance expense, $0.01 per share higher interest expense and $0.02 per share lower gains on outparcel sales.
•
Same-center NOI improved sequentially to a decline of 4.4% for the fourth quarter 2018, over the prior-year quarter. For the full-year 2018 same-center NOI declined 6.0%, over the prior-year period.
•
Average gross rent per square foot declined 10.8% for stabilized mall leases signed in 2018 over the prior rate.
•
Total portfolio occupancy at December 31, 2018 was 93.1%, representing a sequential improvement of 110 basis points and a 10 basis point decline from the prior year-end.
•
Same-center sales per square foot for 2018 were $377, an increase of 0.5% compared with $375 for 2017.

 
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CBL's Chief Executive Officer, Stephen D. Lebovitz, commented, "2018 closed on a positive note with adjusted FFO and same-center NOI in-line with our guidance range and a sequential improvement in operating results.  We are making significant progress on our strategic priority of transforming our properties into suburban town centers, while at the same time limiting our cash investment.  In the fourth quarter, we completed replacements of four former department stores.  We have a dozen replacements under construction or positioned to start construction later this year as well as leases out for signature or in negotiations on numerous other locations.  We are using these opportunities to diversify our properties’ offerings to include more food, entertainment, fitness, service and non-retail uses.  Over 67% of new leases executed last year were with non-apparel tenants.

"Our most exciting recent news is the closing in January of a new $1.185 billion secured credit facility. This new facility is a major vote of confidence by our bank group and a huge step forward in providing the flexibility and runway to execute our strategy.  As a result, our balance sheet is stronger and our maturity schedule is extended. The enhanced retained cash flow provided by the November 2018 dividend reduction also allows us to fund redevelopments on a leverage neutral basis as well as reduce debt. As our 2019 guidance indicates, we are still facing challenges in our business primarily as a result of the more than 40 anchor closures between the Bon-Ton and Sears bankruptcies. That being said, our strategy of owning the best real estate in our markets positions us to benefit from strong demand from new users looking to locate in our markets such as the Cheesecake Factory we recently opened in Chattanooga.  As we move into 2019, our top priority is stabilizing our NOI and FFO with new income from the redevelopments and anchor replacements as well as improved leasing and other revenue sources.” 
 
Net loss attributable to common shareholders for the fourth quarter 2018 was $67.0 million, or $(0.39) per diluted share, compared with net income of $25.2 million, or $0.15 per diluted share for the fourth quarter 2017. Net loss attributable to common shareholders for the fourth quarter 2018 included $91.8 million of loss on impairment of real estate, primarily related to the write downs of the carrying value of Honey Creek Mall and Eastland Mall to each property's estimated fair value.

Net loss attributable to common shareholders for 2018 was $125.3 million, or $(0.73) per diluted share, compared with net income of $76.0 million, or $0.44 per diluted share, for 2017. Net loss attributable to common shareholders for 2018 was impacted by $176.4 million of loss on impairment of real estate.

FFO allocable to common shareholders, as adjusted, for the fourth quarter of 2018 was $77.4 million, or $0.45 per diluted share, compared with $96.4 million, or $0.56 per diluted share, for the fourth quarter of 2017. FFO allocable to the Operating Partnership common unitholders, as adjusted, for the fourth quarter of 2018 was $89.4 million compared with $112.3 million for the fourth quarter of 2017.
FFO allocable to common shareholders, as adjusted, for 2018 was $298.2 million, or $1.73 per diluted share, compared with $355.1 million, or $2.08 per diluted share, for 2017. FFO allocable to the Operating Partnership common unitholders, as adjusted, for 2018 was $345.1 million compared with $413.7 million for 2017.
Percentage change in same-center Net Operating Income ("NOI")(1):

 
Three Months
Ended December 31,
 
Year Ended
December 31,
 
2018
 
2018
Portfolio same-center NOI
(4.4)%
 
(6.0)%
Mall same-center NOI
(4.6)%
 
(6.2)%
(1) CBL's definition of same-center NOI excludes the impact of lease termination fees and certain non-cash items of straight line rents, write-offs of landlord inducements, and net amortization of acquired above and below market leases.

MAJOR ITEMS IMPACTING SAME-CENTER NOI RESULTS FOR 2018

▪
NOI declined $40.1 million during 2018, primarily due to a $41.7 million decrease in revenue offset by a $1.8 million decrease in expense.


 
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▪
Minimum rents, tenant reimbursements and other revenues declined $41.8 million, primarily due to store closures and rent concessions related to tenants in bankruptcy.
▪
Other rents, including business development and short-term specialty leasing, declined $0.2 million.
▪
Percentage rents increased $0.3 million, due to an increase in sales.
▪
Property operating expense declined $2.5 million and real estate tax expense declined $2.1 million. Maintenance and repairs expense increased $2.8 million, substantially due to a $1.8 million increase in snow removal expense.

PORTFOLIO OPERATIONAL RESULTS

Occupancy (1):
 
 
As of December 31,
 
 
2018
 
2017
Portfolio occupancy
 
93.1%
 
93.2%
Mall portfolio
 
91.8%
 
92.0%
Same-center malls
 
92.1%
 
92.2%
Stabilized malls 
 
92.1%
 
92.1%
Non-stabilized malls (2)
 
76.7%
 
88.4%
Associated centers
 
97.4%
 
97.9%
Community centers
 
97.2%
 
96.8%
(1) Occupancy for malls represents percentage of mall store gross leasable area less than 20,000 square feet occupied. Occupancy for associated and community centers represents percentage of gross leasable area occupied.
(2) Represents occupancy for The Outlet Shoppes at Laredo as of December 31, 2018 and occupancy for The Outlet Shoppes of the Bluegrass and The Outlet Shoppes at Laredo as of December 31, 2017.

New and Renewal Leasing Activity of Same Small Shop Space Less Than 10,000 Square Feet:
% Change in Average Gross Rent Per Square Foot
 
 
Three Months
Ended December 31,
 
Year Ended
December 31,
 
 
2018
 
2018
Stabilized Malls
 
(9.1)%
 
(10.8)%
New leases
 
2.6%
 
(1.7)%
Renewal leases
 
(11.3)%
 
(12.5)%

Same-center Sales Per Square Foot for Mall Tenants 10,000 Square Feet or Less:
 
Year Ended December 31,
 
 
2018
 
2017
% Change
Stabilized mall same-center sales per square foot
$
377

 
$
375

0.5%
Stabilized mall sales per square foot
$
377

 
$
372

1.3%


 
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DISPOSITIONS
In 2018, CBL raised more than $100 million in gross proceeds through asset sales:
Property
 
Location
 
Date Closed
 
Gross Sales
Price (M)
Various Outparcels
 
Various
 
Various
 
$
35.9

Phase III Gulf Coast Town Center
 
Ft. Myers, FL
 
March
 
9.0

Janesville Mall
 
Janesville, WI
 
July
 
18.0

Statesboro Crossing
 
Statesboro, GA
 
August
 
21.5

Parkway Plaza
 
Ft. Oglethorpe, GA
 
October
 
16.5

Total
 
 
 
 
 
$
100.9


In January 2019, CBL completed the sale of Cary Towne Center in Cary, NC, for $31.5 million. Proceeds from the sale were used to satisfy a portion of the $43.7 million outstanding non-recourse loan secured by the property. The remaining principal balance was forgiven. CBL will provide third party leasing and management services to the new owners.
In January 2019, CBL completed the transfer of Acadiana Mall to the holder of the note in exchange for extinguishment of the $119.8 million loan.
FINANCING ACTIVITY
In 2018, CBL completed more than $340 million of financing activity.
CBL closed on two non-recourse secured loans during the year aggregating $230.0 million ($133.75 at CBL's share). The new loans included a $155.0 million ($77.5 million at CBL’s share) non-recourse loan secured by CoolSprings Galleria in Nashville, TN and a $75.0 million ($56.25 million at CBL's share) non-recourse loan secured by The Outlet Shoppes at El Paso in El Paso, TX. Both loans have 10-year terms and bear a weighted average fixed interest rate of 4.925%.
CBL completed five-year extensions of two loans including the $56.7 million ($28.4 million at CBL’s share) loan secured by The Pavilion at Port Orange in Port Orange, FL, and the $58.2 million ($29.1 million at CBL’s share) loan secured by Hammock Landing in West Melbourne, FL. The loans were extended for an initial term of three years, with two one-year extensions available at the Company’s option, for a final maturity in February 2023. The new loans bear interest at 225 basis points over LIBOR, an increase of 25 bps over the prior rate.
In January 2019, CBL closed on a new $1.185 billion senior secured facility (the “Facility”), which includes a fully-funded $500 million term loan (the “Term Loan”) and a revolving line of credit (the ”Line of Credit”) with total borrowing capacity of $685 million. The Facility matures in July 2023 and bears a floating interest rate of 225 basis points over LIBOR. The Term Loan will be reduced by $35 million per year, paid in quarterly installments. The Facility replaces all of the Company’s prior unsecured bank facilities, which totaled $1.795 billion.
REDEVELOPMENT
During the fourth quarter, CBL announced details of its transformation plan for the former Sears at Hamilton Place in Chattanooga, TN.  As part of the project, Chattanooga will welcome new-to-market entertainment venue Dave & Buster’s, which will feature the latest arcade games, state-of-the-art sports viewing, chef-crafted food and innovative cocktails. In addition, the project will include Dick's Sporting Goods, an approximately 145-room boutique-style hotel, Class “A” office space and additional restaurants and specialty tenants. These new additions will join Cheesecake Factory, which opened in December 2018 on a parcel adjacent to the Sears building. Construction is expected to commence in early 2019.
OUTLOOK AND GUIDANCE
CBL is providing 2019 FFO, as adjusted, guidance in the range of $1.41 - $1.46 per diluted share. Guidance incorporates a full-year budgeted impact of loss in rent related to 2018 tenant bankruptcies, store and anchor closures and rent adjustments net of expected new leasing as well as a reserve in the range of $5.0 - $15.0 million (the

 
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"Reserve") for potential future unbudgeted loss in rent from tenant bankruptcies, store closures or lease modifications that may occur in 2019. Detail of assumptions underlying guidance follows:
 
Low
 
High
2019 FFO per share, as adjusted (includes the Reserve)
$1.41
 
$1.46
2019 Change in Same-Center NOI ("SC NOI") (includes the Reserve)
(7.75)%
 
(6.25)%
Reserve for unbudgeted lost rents included in SC NOI and FFO
$15.0 million
 
$5.0 million
Gains on outparcel sales
$10.0 million
 
$15.0 million

Assumptions underlying the change in 2019 Same-Center NOI are as follows:    
 
 
Estimated Impact to 2019 SC NOI
 
Explanation
New Leasing/Contractual Rent Increases
 
3.0%
 
 
Rent loss from Anchor Closures
 
(1.8)%
 
Includes 2018 actual and 2019 budgeted anchor closures
Store Closures/Non-renewals
 
(3.1)%
 
Includes 2018 actual and budgeted 2019 store closures at natural lease maturation as well as mid-term store closures primarily related to tenants in bankruptcy
Lease Renewals
 
(2.1)%
 
Impact of net lease renewals completed in 2018 and budgeted for 2019, including certain tenants in bankruptcy reorganization
Lease Modifications/Co-tenancy
 
(1.4)%
 
Mid-term lease modifications or co-tenancy rent triggered in 2018 and budgeted for 2019
Reserve for lost rents
 
(1.6)%
 
Mid-point ($10M) of reserve for future unbudgeted lost rents
Total 2019 SC NOI Change at Midpoint
 
(7.0)%
 
 

Reconciliation of major variances in 2018 FFO, as adjusted, per share to 2019 FFO per share guidance at mid-point:
 
 
2018 FFO per share, as adjusted
$
1.73

Change in SC NOI (excluding reserve for unbudgeted lost rents)
(0.17
)
Reserve for unbudgeted lost rents ($10M)
(0.05
)
Outparcel Sales Gains
—

Dilution from 2018 Asset Sales
(0.04
)
Net Interest Expense (pro rata share of consolidated and unconsolidated)
—

Net Impact of Non-Core and Other Corporate Items
(0.03
)
Mid-point of 2019 FFO, per share, as adjusted guidance
$
1.44


 
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Reconciliation of GAAP net income to 2019 FFO, as adjusted, per share guidance:
 
Low
 
High
Expected diluted earnings per common share
$
0.42

 
$
0.47

Adjust to fully converted shares from common shares
(0.06
)
 
(0.06
)
Expected earnings per diluted, fully converted common share
0.36

 
0.41

Add: depreciation and amortization
1.36

 
1.36

Add: noncontrolling interest in earnings of Operating Partnership
0.06

 
0.06

Expected FFO per diluted, fully converted common share
1.78

 
1.83

Gain on extinguishment of debt
(0.37
)
 
(0.37
)
Expected FFO, as adjusted, per diluted, fully converted common share
$
1.41

 
$
1.46


INVESTOR CONFERENCE CALL AND WEBCAST
CBL & Associates Properties, Inc. will conduct a conference call at 11:00 a.m. ET on Friday, February 8, 2019, to discuss its fourth quarter and full year results. The number to call for this interactive teleconference is (888) 317-6003 or (412) 317-6061 and the confirmation number is 6970542.  A replay of the conference call will be available through February 15, 2019, by dialing (877) 344-7529 or (412) 317-0088 and entering the confirmation number 10126294. A transcript of the Company's prepared remarks will be furnished on a Form 8-K following the conference call.

To receive the CBL & Associates Properties, Inc., fourth quarter and full year earnings release and supplemental information please visit the Investing section of our website at cblproperties.com or contact Investor Relations at (423) 490-8312.

The Company will also provide an online webcast and rebroadcast of its 2018 fourth quarter and full year earnings release conference call. The live broadcast of the quarterly conference call will be available online at cblproperties.com on Friday, February 8, 2019 beginning at 11:00 a.m. ET. The online replay will follow shortly after the call and continue for three months.

ABOUT CBL & ASSOCIATES PROPERTIES, INC.    
Headquartered in Chattanooga, TN, CBL Properties owns and manages a national portfolio of market-dominant properties located in dynamic and growing communities. CBL’s portfolio is comprised of 115 properties totaling 71.5 million square feet across 26 states, including 72 high-quality enclosed, outlet and open-air retail centers and 11 properties managed for third parties. CBL continuously strengthens its company and portfolio through active management, aggressive leasing and profitable reinvestment in its properties. For more information visit cblproperties.com.


NON-GAAP FINANCIAL MEASURES
Funds From Operations
FFO is a widely used measure of the operating performance of real estate companies that supplements net income (loss) determined in accordance with GAAP. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) (computed in accordance with GAAP) excluding gains or losses on sales of depreciable operating properties and impairment losses of depreciable properties, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures and noncontrolling interests. Adjustments for unconsolidated partnerships and joint ventures and noncontrolling interests are calculated on the same basis. We define FFO as defined above by NAREIT less dividends on preferred stock of the Company or distributions on preferred units of the Operating Partnership, as applicable. The Company’s method of calculating FFO may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
 
The Company believes that FFO provides an additional indicator of the operating performance of its properties without giving effect to real estate depreciation and amortization, which assumes the value of real estate assets

 
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declines predictably over time. Since values of well-maintained real estate assets have historically risen with market conditions, the Company believes that FFO enhances investors’ understanding of its operating performance. The use of FFO as an indicator of financial performance is influenced not only by the operations of the Company’s properties and interest rates, but also by its capital structure. The Company presents both FFO allocable to Operating Partnership common unitholders and FFO allocable to common shareholders, as it believes that both are useful performance measures. The Company believes FFO allocable to Operating Partnership common unitholders is a useful performance measure since it conducts substantially all of its business through its Operating Partnership and, therefore, it reflects the performance of the properties in absolute terms regardless of the ratio of ownership interests of the Company’s common shareholders and the noncontrolling interest in the Operating Partnership. The Company believes FFO allocable to its common shareholders is a useful performance measure because it is the performance measure that is most directly comparable to net income (loss) attributable to its common shareholders.

In the reconciliation of net income attributable to the Company's common shareholders to FFO allocable to operating partnership common unitholders, located in this earnings release, the Company makes an adjustment to add back noncontrolling interest in income (loss) of its Operating Partnership in order to arrive at FFO of its Operating Partnership. The Company then applies a percentage to FFO of its Operating Partnership in order to arrive at FFO of the Operating Partnership common unitholders. The percentage is computed by taking the weighted average number of common shares outstanding for the period and dividing it by the sum of the weighted average number of common shares outstanding for the period and the weighted average number of Operating Partnership units outstanding during the period.

FFO does not represent cash flows from operations as defined by accounting principles generally accepted in the United States, is not necessarily indicative of cash available to fund all cash flow needs and should not be considered as an alternative to net income (loss) for purposes of evaluating the Company’s operating performance or to cash flow as a measure of liquidity.

The Company believes that it is important to identify the impact of certain significant items on its FFO measures for a reader to have a complete understanding of the Company’s results of operations. Therefore, the Company has also presented adjusted FFO measures excluding these significant items from the applicable periods. Please refer to the reconciliation of net income (loss) attributable to common shareholders to FFO allocable to Operating Partnership common unitholders on page 10 of this earnings release for a description of these adjustments.

Same-center Net Operating Income
NOI is a supplemental measure of the operating performance of the Company's shopping centers and other properties. The Company defines NOI as property operating revenues (rental revenues, tenant reimbursements and other income) less property operating expenses (property operating, real estate taxes and maintenance and repairs).

We believe that presenting NOI and same-center NOI (described below) based on our Operating Partnership’s pro rata share of both consolidated and unconsolidated properties is useful since we conduct substantially all of our business through our Operating Partnership and, therefore, it reflects the performance of the properties in absolute terms regardless of the ratio of ownership interests of our common shareholders and the noncontrolling interest in the Operating Partnership. The Company computes NOI based on the Operating Partnership's pro rata share of both consolidated and unconsolidated properties. The Company's definition of NOI may be different than that used by other companies and, accordingly, the Company's NOI may not be comparable to that of other companies.

Since NOI includes only those revenues and expenses related to the operations of its shopping center and other properties, the Company believes that same-center NOI provides a measure that reflects trends in occupancy rates, rental rates and operating costs and the impact of those trends on the Company's results of operations. The Company’s calculation of same-center NOI also excludes lease termination income, straight-line rent adjustments, and amortization of above and below market lease intangibles in order to enhance the comparability of results from one period to another, as these items can be impacted by one-time events that may distort same-center NOI trends and may result in same-center NOI that is not indicative of the ongoing operations of the Company’s shopping center and other properties. A reconciliation of same-center NOI to net income is located at the end of this earnings release.


 
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Pro Rata Share of Debt
The Company presents debt based on its pro rata ownership share (including the Company's pro rata share of unconsolidated affiliates and excluding noncontrolling interests' share of consolidated properties) because it believes this provides investors a clearer understanding of the Company's total debt obligations which affect the Company's liquidity. A reconciliation of the Company's pro rata share of debt to the amount of debt on the Company's consolidated balance sheet is located at the end of this earnings release.

Information included herein contains "forward-looking statements" within the meaning of the federal securities laws. Such statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual events, financial and otherwise, may differ materially from the events and results discussed in the forward-looking statements. The reader is directed to the Company's various filings with the Securities and Exchange Commission, including without limitation the Company's Annual Report on Form 10-K, and the "Management's Discussion and Analysis of Financial Condition and Results of Operations" included therein, for a discussion of such risks and uncertainties.


 
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CBL & Associates Properties, Inc.
Supplemental Financial and Operating Information
For the Three Months and Year Ended December 31, 2018
Consolidated Statements of Operations
(Unaudited; in thousands, except per share amounts)

 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
REVENUES:
 
 
 
 
 
 
 
Minimum rents
$
146,910


$
155,966


$
588,007


$
624,161

Percentage rents
5,149


4,747


11,759


11,874

Other rents
5,136


7,837


12,034


19,008

Tenant reimbursements
44,712


61,975


217,313


254,552

Management, development and leasing fees
2,520


3,235


10,542


11,982

Other
12,454


1,596


18,902


5,675

Total revenues
216,881


235,356


858,557


927,252

OPERATING EXPENSES:







Property operating
29,660


31,780


122,017


128,030

Depreciation and amortization
68,140


73,629


285,401


299,090

Real estate taxes
20,554


21,574


82,291


83,917

Maintenance and repairs
11,591


12,284


48,304


48,606

General and administrative
13,661


13,064


61,506


58,466

Loss on impairment
91,769


—


176,413


71,401

Other
410


29


787


5,180

Total operating expenses
235,785


152,360


776,719


694,690

Income (loss) from operations
(18,904
)

82,996


81,838


232,562

Interest and other income
1,144


471


1,858


1,706

Interest expense
(56,874
)

(53,501
)

(220,038
)

(218,680
)
Gain on extinguishment of debt
—


—


—


30,927

Loss on investment
—


—


—


(6,197
)
Income tax benefit (provision)
(295
)

(2,851
)

1,551


1,933

Equity in earnings of unconsolidated affiliates
4,808


6,535


14,677


22,939

Gain on sales of real estate assets
3,003

 
6,888

 
19,001

 
93,792

Net income (loss)
(67,118
)

40,538


(101,113
)

158,982

Net (income) loss attributable to noncontrolling interests in:







Operating Partnership
10,710


(3,950
)

19,688


(12,652
)
Other consolidated subsidiaries
604


(124
)

973


(25,390
)
Net income (loss) attributable to the Company
(55,804
)

36,464


(80,452
)

120,940

Preferred dividends
(11,223
)

(11,223
)

(44,892
)

(44,892
)
Net income (loss) attributable to common shareholders
$
(67,027
)

$
25,241


$
(125,344
)

$
76,048

 
 
 
 
 
 
 
 
Basic and diluted per share data attributable to common shareholders:







Net income (loss) attributable to common shareholders
$
(0.39
)

$
0.15


$
(0.73
)

$
0.44

Weighted-average common shares outstanding
172,665


171,098


172,486


171,070

 
 
 
 
 
 
 
 
Dividends declared per common share
$
0.075

 
$
0.200

 
$
0.675

 
$
0.995


9

CBL & Associates Properties, Inc.
Supplemental Financial and Operating Information
For the Three Months and Year Ended December 31, 2018
The Company's reconciliation of net income (loss) attributable to common shareholders to FFO allocable to Operating Partnership common unitholders is as follows:
(in thousands, except per share data)

 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
Net income (loss) attributable to common shareholders
$
(67,027
)

$
25,241


$
(125,344
)

$
76,048

Noncontrolling interest in income (loss) of Operating Partnership
(10,710
)

3,950


(19,688
)

12,652

Depreciation and amortization expense of:







Consolidated properties
68,140


73,629


285,401


299,090

Unconsolidated affiliates
10,681


9,591


41,858


38,124

Non-real estate assets
(913
)

(936
)

(3,661
)

(3,526
)
Noncontrolling interests' share of depreciation and amortization
(2,177
)

(2,186
)

(8,601
)

(8,977
)
Loss on impairment, net of taxes
91,657


—


176,300


70,185

Loss on impairment of unconsolidated affiliates
—

 
—

 
1,022

 
—

Gain on depreciable property, net of taxes and noncontrolling interests' share
(1,941
)

(222
)

(7,484
)

(48,983
)
FFO allocable to Operating Partnership common unitholders
87,710

 
109,067

 
339,803

 
434,613

    Litigation expenses (1)
—


34


—


103

    Nonrecurring professional fees reimbursement (1)
—

 
—

 
—

 
(919
)
    Loss on investment (2)
—


—


—


6,197

    Non-cash default interest expense (3)
1,669

 
921

 
5,285

 
5,319

    Impact of new tax law on income tax expense
—

 
2,309

 
—

 
2,309

    Gain on extinguishment of debt, net of
noncontrolling interests' share (4)
—


—


—


(33,902
)
FFO allocable to Operating Partnership common unitholders, as adjusted
$
89,379


$
112,331


$
345,088


$
413,720

 
 
 
 
 
 
 
 
FFO per diluted share
$
0.44


$
0.55


$
1.70


$
2.18

 
 
 
 
 
 
 
 
FFO, as adjusted, per diluted share
$
0.45


$
0.56


$
1.73


$
2.08

 
 
 
 
 
 
 
 
Weighted average common and potential dilutive common shares outstanding with Operating Partnership units fully converted
199,430

 
199,314

 
199,580

 
199,322

(1) Litigation expenses are included in general and administrative expense in the consolidated statements of operations. Nonrecurring professional fees reimbursement is included in interest and other income in the consolidated statements of operations.
 
(2) The year ended December 31, 2017 includes a loss on investment related to the write down of our 25% interest in River Ridge Mall based on the contract price to sell such interest to our joint venture partner. The sale closed in August 2017.
 
 
 
 
 
 
 
 
(3) The three months and year ended December 31, 2018 includes non-cash default interest expense related to Acadiana Mall, Cary Town Center and Triangle Town Center. The three months and year ended December 31, 2017 includes default interest expense related to Acadiana Mall. The year ended December 31, 2017 also includes default interest expense related to Chesterfield Mall, Midland Mall and Wausau Center.
 
 
 
 
 
 
 
 
(4) The year ended December 31, 2017 includes a $6,851 gain on extinguishment of debt related to the non-recourse loan secured by Wausau Center, which was conveyed to the lender in the third quarter of 2017, which was partially offset by a loss on extinguishment of debt related to a prepayment fee of $371 related to the early retirement of a mortgage loan, a gain on extinguishment of debt related to the non-recourse loan secured by Chesterfield Mall, which was conveyed to the lender in the second quarter of 2017, a loss on extinguishment of debt related to a prepayment fee on the early retirement of the loans secured by The Outlet Shoppes at Oklahoma City, which was sold in the second quarter of 2017, and a gain on extinguishment of debt related to the non-recourse loan secured by Midland Mall, which was conveyed to the lender in the first quarter of 2017.

10


The reconciliation of diluted EPS to FFO per diluted share is as follows:
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
Diluted EPS attributable to common shareholders
$
(0.39
)
 
$
0.15

 
$
(0.73
)
 
$
0.44

Eliminate amounts per share excluded from FFO:
 
 
 
 
 
 
 
Depreciation and amortization expense, including amounts from consolidated properties, unconsolidated affiliates, non-real estate assets and excluding amounts allocated to noncontrolling interests
0.38

 
0.40

 
1.58

 
1.64

Loss on impairment, net of taxes
0.46

 
—

 
0.89

 
0.35

Gain on depreciable property, net of taxes and noncontrolling interests' share
(0.01
)
 
—

 
(0.04
)
 
(0.25
)
FFO per diluted share
$
0.44

 
$
0.55

 
$
1.70

 
$
2.18



The reconciliations of FFO allocable to Operating Partnership common unitholders to FFO allocable to common shareholders, including and excluding the adjustments noted above, are as follows:
    
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
FFO allocable to Operating Partnership common unitholders
$
87,710

 
$
109,067

 
$
339,803

 
$
434,613

Percentage allocable to common shareholders (1)
86.58
%
 
85.84
%
 
86.42
%
 
85.83
%
FFO allocable to common shareholders
$
75,939

 
$
93,623

 
$
293,658

 
$
373,028

 
 
 
 
 
 
 
 
FFO allocable to Operating Partnership common unitholders, as adjusted
$
89,379

 
$
112,331

 
$
345,088

 
$
413,720

Percentage allocable to common shareholders (1)
86.58
%
 
85.84
%
 
86.42
%
 
85.83
%
FFO allocable to common shareholders, as adjusted
$
77,384

 
$
96,425

 
$
298,225

 
$
355,096

(1) Represents the weighted average number of common shares outstanding for the period divided by the sum of the weighted average number of common shares and the weighted average number of Operating Partnership units outstanding during the period. See the reconciliation of shares and Operating Partnership units outstanding on page 16.

11

 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
SUPPLEMENTAL FFO INFORMATION:
 
 
 
 
 
 
 
Lease termination fees
$
317

 
$
2,042

 
$
10,105

 
$
4,036

Lease termination fees per share
$
—

 
$
0.01

 
$
0.05

 
$
0.02

 
 
 
 
 
 
 
 
Straight-line rental income
$
(1,108
)
 
$
(197
)
 
$
(5,031
)
 
$
31

Straight-line rental income per share
$
(0.01
)
 
$
—

 
$
(0.03
)
 
$
—

 
 
 
 
 
 
 
 
Gains on outparcel sales
$
1,679

 
$
6,678

 
$
13,138

 
$
18,374

Gains on outparcel sales per share
$
0.01

 
$
0.03

 
$
0.07

 
$
0.09

 
 
 
 
 
 
 
 
Net amortization of acquired above- and below-market leases
$
662

 
$
903

 
$
1,644

 
$
4,365

Net amortization of acquired above- and below-market leases per share
$
—

 
$
—

 
$
0.01

 
$
0.02

 
 
 
 
 
 
 
 
Net amortization of debt (premiums) discounts
$
316

 
$
140

 
$
1,043

 
$
(632
)
Net amortization of debt (premiums) discounts per share
$
—

 
$
—

 
$
0.01

 
$
—

 
 
 
 
 
 
 
 
 Income tax benefit (provision) prior to impact of 2017 tax law
$
(295
)
 
$
(542
)
 
$
1,551

 
$
4,242

Income tax benefit (provision) prior to impact of 2017 tax law per share
$
—

 
$
—

 
$
0.01

 
$
0.02

 
 
 
 
 
 
 
 
 Impact of new tax law on income tax expense
$
—

 
$
(2,309
)
 
$
—

 
$
(2,309
)
Impact of new tax law on income tax expense per share
$
—

 
$
(0.01
)
 
$
—

 
$
(0.01
)
 
 
 
 
 
 
 
 
Abandoned projects expense
$
(410
)
 
$
(29
)
 
$
(787
)
 
$
(5,180
)
Abandoned projects expense per share
$
—

 
$
—

 
$
—

 
$
(0.03
)
 
 
 
 
 
 
 
 
Gain on extinguishment of debt, net of noncontrolling interests' share
$
—

 
$
—

 
$
—

 
$
33,902

Gain on extinguishment of debt, net of noncontrolling interests' share, per share
$
—

 
$
—

 
$
—

 
$
0.17

 
 
 
 
 
 
 
 
Non cash default interest expense
$
(1,669
)
 
$
(921
)
 
$
(5,285
)
 
$
(5,319
)
Non cash default interest expense per share
$
(0.01
)
 
$
—

 
$
(0.03
)
 
$
(0.03
)
 
 
 
 
 
 
 
 
 Loss on investment
$
—

 
$
—

 
$
—

 
$
(6,197
)
Loss on investment per share
$
—

 
$
—

 
$
—

 
$
(0.03
)
 
 
 
 
 
 
 
 
Interest capitalized
$
919

 
$
554

 
$
3,655

 
$
2,230

Interest capitalized per share
$
—

 
$
—

 
$
0.02

 
$
0.01

 
 
 
 
 
 
 
 
Litigation expenses
$
—

 
$
(34
)
 
$
—

 
$
(103
)
Litigation expenses per share
$
—

 
$
—

 
$
—

 
$
—

 
 
 
 
 
 
 
 
Nonrecurring professional fees reimbursement
$
—

 
$
—

 
$
—

 
$
919

Nonrecurring professional fees reimbursement per share
$
—

 
$
—

 
$
—

 
$
—

 
 
As of December 31,
 
 
2018
 
2017
Straight-line rent receivable

$
55,902


$
61,506


12

CBL & Associates Properties, Inc.
Supplemental Financial and Operating Information
For the Three Months and Year Ended December 31, 2018
Same-center Net Operating Income
(Dollars in thousands)


Three Months Ended
December 31,

Year Ended
December 31,

2018

2017

2018

2017
Net income (loss)
$
(67,118
)

$
40,538


$
(101,113
)

$
158,982













Adjustments:











Depreciation and amortization
68,140


73,629


285,401


299,090

Depreciation and amortization from unconsolidated affiliates
10,681


9,591


41,858


38,124

Noncontrolling interests' share of depreciation and amortization in other consolidated subsidiaries
(2,177
)

(2,186
)

(8,601
)

(8,977
)
Interest expense
56,874


53,501


220,038


218,680

Interest expense from unconsolidated affiliates
6,754


6,268


25,603


25,083

Noncontrolling interests' share of interest expense in other consolidated subsidiaries
(1,837
)

(1,902
)

(7,749
)

(7,062
)
Abandoned projects expense
410


29


787


5,180

Gain on sales of real estate assets
(3,003
)

(6,888
)

(19,001
)

(93,792
)
Gain on sales of real estate assets of unconsolidated affiliates
(1,043
)

(12
)

(1,607
)

(201
)
Noncontrolling interests' share of gain on sales of real estate assets in other consolidated subsidiaries
—

 
—

 
—

 
26,639

Loss on investment
—


—


—


6,197

Gain on extinguishment of debt
—


—


—


(30,927
)
Noncontrolling interests' share of loss on extinguishment of debt in other consolidated subsidiaries
—

 
—

 
—

 
(2,975
)
Loss on impairment
91,769


—


176,413


71,401

Income tax (benefit) provision
295


2,851


(1,551
)

(1,933
)
Lease termination fees
(317
)

(2,042
)

(10,105
)

(4,036
)
Straight-line rent and above- and below-market lease amortization
446


(711
)

3,387


(4,396
)
Net (income) loss attributable to noncontrolling interest in other consolidated subsidiaries
604


(124
)

973


(25,390
)
General and administrative expenses
13,661


13,064


61,506


58,466

Management fees and non-property level revenues
(4,501
)

(4,046
)

(14,143
)

(14,115
)
Operating Partnership's share of property NOI
169,638


181,560


652,096


714,038

Non-comparable NOI
(5,367
)

(9,750
)

(26,582
)

(48,420
)
Total same-center NOI (1)
$
164,271


$
171,810


$
625,514


$
665,618

Total same-center NOI percentage change
(4.4
)%



(6.0
)%













13

Same-center Net Operating Income
(Continued)
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
Malls
$
148,862

 
$
155,970

 
$
564,855

 
$
602,394

Associated centers
8,337

 
8,282

 
32,566

 
33,173

Community centers
5,616

 
5,609

 
21,918

 
22,618

Offices and other
1,456

 
1,949

 
6,175

 
7,433

Total same-center NOI (1)
$
164,271

 
$
171,810

 
$
625,514

 
$
665,618

 
 
 
 
 
 
 
 
Percentage Change:
 
 
 
 
 
 
 
Malls
(4.6
)%
 
 
 
(6.2
)%
 
 
Associated centers
0.7
 %
 
 
 
(1.8
)%
 
 
Community centers
0.1
 %
 
 
 
(3.1
)%
 
 
Offices and other
(25.3
)%
 
 
 
(16.9
)%
 
 
Total same-center NOI (1)
(4.4
)%
 
 
 
(6.0
)%
 
 
(1)
CBL defines NOI as property operating revenues (rental revenues, tenant reimbursements and other income), less property operating expenses (property operating, real estate taxes and maintenance and repairs). Same-center NOI excludes lease termination income, straight-line rent adjustments, amortization of above and below market lease intangibles and write-offs of landlord inducement assets. We include a property in our same-center pool when we own all or a portion of the property as of December 31, 2018, and we owned it and it was in operation for both the entire preceding calendar year and the current year-to-date reporting period ending December 31, 2018. New properties are excluded from same-center NOI, until they meet this criteria. Properties excluded from the same-center pool that would otherwise meet this criteria are properties which are under major redevelopment or being considered for repositioning, where we intend to renegotiate the terms of the debt secured by the related property or return the property to the lender.

14


CBL & Associates Properties, Inc.
Supplemental Financial and Operating Information
As of December 31, 2018 and 2017

Company's Share of Consolidated and Unconsolidated Debt


As of December 31, 2018


Fixed Rate

Variable
Rate

Total per
Debt
Schedule
 
Unamortized
Deferred
Financing
Costs
 
Total
Consolidated debt

$
3,147,108

 
$
955,751


$
4,102,859

(1) 
$
(15,963
)
 
$
4,086,896

Noncontrolling interests' share of consolidated debt

(94,361
)
 
—


(94,361
)
 
804

 
(93,557
)
Company's share of unconsolidated affiliates' debt

550,673

 
99,904


650,577

 
(2,687
)
 
647,890

Company's share of consolidated and unconsolidated debt

$
3,603,420


$
1,055,655


$
4,659,075

 
$
(17,846
)
 
$
4,641,229

Weighted average interest rate

5.16
%
 
4.28
%
 
4.96
%
 
 
 
 


 
 
 
 
 
 
 
 
 


As of December 31, 2017


Fixed Rate

Variable
Rate

Total per
Debt
Schedule
 
Unamortized
Deferred
Financing
Costs
 
Total
Consolidated debt

$
3,158,973


$
1,090,810


$
4,249,783

 
$
(18,938
)
 
$
4,230,845

Noncontrolling interests' share of consolidated debt

(77,155
)

(5,418
)

(82,573
)
 
687

 
(81,886
)
Company's share of unconsolidated affiliates' debt

532,766


64,455


597,221

 
(2,441
)
 
594,780

Company's share of consolidated and unconsolidated debt

$
3,614,584


$
1,149,847


$
4,764,431

 
$
(20,692
)
 
$
4,743,739

Weighted average interest rate

5.19
%

2.93
%

4.65
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Includes $43,716 of debt related to Cary Town Center that is classified in liabilities related to assets held for sale in the consolidated balance sheet as of December 31, 2018. The mall was sold in January 2019.


Debt-To-Total-Market Capitalization Ratio as of December 31, 2018
(In thousands, except stock price)
 
 
Shares
Outstanding
 
Stock Price (1)
 
Value
Common stock and Operating Partnership units

199,415


$
1.92


$
382,877

7.375% Series D Cumulative Redeemable Preferred Stock

1,815


250.00


453,750

6.625% Series E Cumulative Redeemable Preferred Stock

690


250.00


172,500

Total market equity

 
 
 

1,009,127

Company's share of total debt, excluding unamortized deferred financing costs

 
 
 

4,659,075

Total market capitalization

 
 
 

$
5,668,202

Debt-to-total-market capitalization ratio

 
 
 

82.2
%
 
 
 
 
 
 
 
(1) Stock price for common stock and Operating Partnership units equals the closing price of the common stock on December 31, 2018. The stock prices for the preferred stocks represent the liquidation preference of each respective series.

15

CBL & Associates Properties, Inc.
Supplemental Financial and Operating Information
As of December 31, 2018 and 2017


Reconciliation of Shares and Operating Partnership Units Outstanding
(In thousands)


Three Months Ended
December 31,

Year Ended
December 31,
2018:

Basic

Diluted

Basic

Diluted
Weighted average shares - EPS

172,665

 
172,665

 
172,486

 
172,486

Weighted average Operating Partnership units

26,765


26,765


27,094


27,094

Weighted average shares - FFO

199,430


199,430


199,580


199,580










2017:








Weighted average shares - EPS

171,098


171,098


171,070


171,070

Weighted average Operating Partnership units

28,216


28,216


28,252


28,252

Weighted average shares - FFO

199,314


199,314


199,322


199,322



Dividend Payout Ratio


Three Months Ended
December 31,

Year Ended
December 31,


2018

2017

2018

2017
Weighted average cash dividend per share

$
0.08590


$
0.20888


$
0.71251


$
1.02731

FFO as adjusted, per diluted fully converted share

$
0.45


$
0.56


$
1.73


$
2.08

Dividend payout ratio

19.1
%

37.3
%

41.2
%

49.4
%

16

CBL & Associates Properties, Inc.
Supplemental Financial and Operating Information
As of December 31, 2018 and 2017

Consolidated Balance Sheets
(Unaudited; in thousands, except share data)

 As of December 31,

2018

2017
 ASSETS



Real estate assets:



Land
$
793,944


$
813,390

Buildings and improvements
6,413,003


6,723,194

 
7,206,947


7,536,584

Accumulated depreciation
(2,493,082
)

(2,465,095
)

4,713,865


5,071,489

Held for sale
30,971


—

Developments in progress
38,807


85,346

Net investment in real estate assets
4,783,643


5,156,835

Cash and cash equivalents
25,138


32,627

Receivables:



 

Tenant, net of allowance for doubtful accounts of $2,337
and $2,011 in 2018 and 2017, respectively
77,788


83,552

Other, net of allowance for doubtful accounts of $838 in 2017
7,511


7,570

Mortgage and other notes receivable
7,672


8,945

Investments in unconsolidated affiliates
283,553


249,192

Intangible lease assets and other assets
153,665


166,087


$
5,338,970


$
5,704,808

 
 
 
 
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
 


Mortgage and other indebtedness, net
$
4,043,180


$
4,230,845

Accounts payable and accrued liabilities
218,217


228,650

Liabilities related to assets held for sale
43,716

 
—

Total liabilities
4,305,113


4,459,495

Commitments and contingencies



Redeemable noncontrolling interests  
3,575


8,835

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, 172,656,458 and 171,088,778 issued and
outstanding in 2018 and 2017, respectively
1,727


1,711

Additional paid-in capital
1,968,280


1,974,537

Dividends in excess of cumulative earnings
(1,007,778
)

(836,269
)
Total shareholders' equity
962,254


1,140,004

Noncontrolling interests
68,028


96,474

Total equity
1,030,282


1,236,478


$
5,338,970


$
5,704,808


17

CBL & Associates Properties, Inc.
Supplemental Financial And Operating Information
As of December 31, 2018 and 2017

Condensed Combined Financial Statements - Unconsolidated Affiliates
(Unaudited; in thousands)
 
As of December 31,
 
2018
 
2017
 ASSETS:
 
 
 
Investment in real estate assets
$
2,099,108

 
$
2,089,262

Accumulated depreciation
(674,275
)
 
(618,922
)

1,424,833

 
1,470,340

Developments in progress
12,569

 
36,765

 Net investment in real estate assets
1,437,402

 
1,507,105

Other assets
186,501

 
201,114

 Total assets
$
1,623,903

 
$
1,708,219

 
 
 
 
LIABILITIES:

 

Mortgage and other indebtedness, net
$
1,319,949

 
$
1,248,817

Other liabilities
39,777

 
41,291

Total liabilities
1,359,726

 
1,290,108

 
 
 
 
OWNERS' EQUITY:

 

The Company
191,050

 
216,292

Other investors
73,127

 
201,819

Total owners' equity
264,177

 
418,111

Total liabilities and owners’ equity
$
1,623,903

 
$
1,708,219

 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2018
 
2017
 
2018
 
2017
 Total revenues
$
58,230

 
$
61,357

 
$
225,073

 
$
236,607

 Depreciation and amortization
(19,256
)
 
(19,826
)
 
(78,174
)
 
(80,102
)
 Loss on impairment
—

 
—

 
(89,826
)
 
—

 Other operating expenses
(18,030
)
 
(18,475
)
 
(72,056
)
 
(71,293
)
 Income (loss) from operations
20,944

 
23,056

 
(14,983
)
 
85,212

 Interest income
356

 
485

 
1,415

 
1,671

 Interest expense
(13,958
)
 
(12,952
)
 
(52,803
)
 
(51,843
)
 Gain on sales of real estate assets
1,928

 
26

 
3,056

 
555

 Net income (loss)
$
9,270

 
$
10,615

 
$
(63,315
)
 
$
35,595

 
Company's Share for the
Three Months Ended December 31,
 
Company's Share for the
Year Ended December 31,
 
2018
 
2017
 
2018
 
2017
 Total revenues
$