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Real Estate for Everyday Retail®
$17.61 NYSE: WRI
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Press Release

 Weingarten Realty Reports Second Quarter Results and Provides COVID-19 Update

Company Release - 7/29/2020 4:05 PM ET

HOUSTON--(BUSINESS WIRE)-- Weingarten Realty (NYSE: WRI) announced today the results of its operations for the quarter ended June 30, 2020. The supplemental financial package with additional information can be found on the Company's website under the Investor Relations tab.

“Given the headwinds of the pandemic, we had a relatively good quarter. With the reopening of the economy in our markets, most of our tenants have been able to restart operations as they learn to operate in this challenging environment. Accordingly, we have experienced continued improvement in our cash collections and rent deferrals. Our balance sheet remains strong and our liquidity position is more than adequate. We remain focused on the safety and well-being of our associates, tenants, stakeholders and the broader community. With a transformed portfolio of primarily grocery-anchored centers providing basic goods and services, we are optimistic our centers will perform well, on a relative basis, in this crisis,” said Drew Alexander, Chairman, President and Chief Executive Officer.

Second Quarter Operating and Financial Highlights

  • Net income attributable to common shareholders (“Net Income”) for the quarter was $0.09 per diluted share (hereinafter “per share”) compared to $0.65 per share in the same quarter of 2019;
  • Core Funds From Operations Attributable to Common Shareholders ("Core FFO") for the quarter was $0.34 per share compared to $0.53 per share a year ago;
  • Bad debt expense/uncollectible revenue primarily related to COVID-19 for the quarter was $19.3 million or $0.15 per share and included $4.8 million or $0.04 per share of non-cash straight line rent receivables; and
  • Dispositions to date totaled $131 million, including property sales closed subsequent to quarter-end totaling $43 million.

Financial Results

The Company reported Net Income of $11.4 million or $0.09 per share for the second quarter of 2020, as compared to $83.8 million or $0.65 per share for the same period in 2019 as the coronavirus pandemic continues to negatively affect the Company’s tenants. The Company recorded bad debt expense/uncollectible revenue of $19.3 million in the second quarter of 2020 which includes $4.8 million of non-cash straight line rent receivables. This is in addition to total bad debt expense/uncollectible expense of $9.4 million recorded in the first quarter of 2020 which included non-cash straight line rent receivables of $7.6 million.

Year-to-date, Net Income was $64.0 million or $0.50 per share for 2020 compared to $133.5 million or $1.03 per share for 2019.

Funds From Operations attributable to common shareholders in accordance with the National Association of Real Estate Investment Trusts definition (“NAREIT FFO”) was $43.9 million or $0.34 per share for the second quarter of 2020 compared to $68.7 million or $0.53 per share for 2019. The decrease is primarily due to disposition activity and the $19.3 million of bad debt expense/uncollectible revenue primarily related to the coronavirus pandemic. Core FFO for the quarter ended June 30, 2020 was $43.9 million or $0.34 per share compared to $68.7 million or $0.53 per share for the same quarter of last year.

A reconciliation of Net Income to NAREIT FFO and Core FFO is included herein.

Operating Results

For the period ending June 30, 2020, the Company’s operating highlights were as follows:

 

 

 

 

 

 

 

 

 

 

 

Q2 2020

YTD 2020

Occupancy (Signed Basis):

 

 

 

 

 

 

 

 

Occupancy - Total

 

 

93.4

%

 

 

 

 

Occupancy - Small Shop Spaces

 

 

89.0

%

 

 

 

 

Occupancy - Same Property Portfolio

 

 

94.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Same Property Net Operating Income, with redevelopments

 

 

(19.7)

%

 

(9.8)

%

 

 

 

 

 

 

 

 

 

 

Rental Rate Growth - Total:

 

 

7.3

%

 

9.0

%

 

New Leases

 

 

10.3

%

 

13.2

%

 

Renewals

 

 

7.0

%

 

8.4

%

 

 

 

 

 

 

 

 

 

 

Leasing Transactions:

 

 

 

 

 

 

 

 

Number of New Leases

 

 

27

 

 

83

 

 

New Leases - Annualized Revenue (in millions)

 

$

1.8

 

$

6.3

 

 

Number of Renewals

 

 

109

 

 

253

 

 

Renewals - Annualized Revenue (in millions)

 

$

9.2

 

$

26.1

 

 

A reconciliation of Net Income to SPNOI is included herein.

COVID-19 Update

The coronavirus pandemic continues to impact the Company’s operations. At the end of the second quarter, approximately 95% of the Company’s tenants were open for business though conditions are ever changing. Cash collections in April, May and June totaled 77%, 73% and 79%, respectively of prorata base rent and expense recoveries. For the second quarter, overall cash collections were 77%. These strong cash collections are a definitive reflection of the Company’s successful transformation of its portfolio over the last several years. Cash collections in July are trending up with 82% collected to-date. Deferrals of rent payments to future periods executed in April, May and June represent an additional 14%, 18% and 10%, respectively. Deferrals for the second quarter were 13% and bad debt expense/uncollectible revenue on a prorata basis applied against these deferrals was $4.7 million or 30% of the amounts deferred at June 30, 2020. Abatements of rent for the quarter were 1% of total rent and the Company continues to work closely with all of its tenants.

The reopening of the economy has not been without challenges as the pace of new COVID-19 infections has increased at an alarming rate which has resulted in a temporary reversal of tenants reopening efforts in some markets. Nevertheless, the Company is confident that collections will remain strong as rents from tenants deemed “essential” represent 63% of total rents for the quarter. Cash collections from these essential tenants were 86% for the second quarter.

“We continue to devote a tremendous amount of effort in assisting our tenants in their reopening efforts and to obtaining rent payments. We are extremely pleased with our cash collection results which continue to improve. We remain confident that our transformed portfolio of quality properties will enable us to weather this storm,” said Johnny Hendrix, Executive Vice President and Chief Operating Officer.

Additional information can be found on page 41 of our supplemental disclosure.

Balance Sheet, Liquidity and Dividends

The benefit of the Company’s best in class balance sheet has been highlighted by this crisis. With low leverage and the absence of any material maturities until the fourth quarter of 2022, the Company is comfortable that it has adequate liquidity to restore its properties to their full operating potential. Given the general stability of the financial markets and the Company’s access to other sources of liquidity, the Company used its excess cash balances and disposition proceeds to pay down its revolving credit facility. The Company will continue to carefully monitor cash flows, any new capital requirements, and overall liquidity going forward.

In light of the uncertainties surrounding the pandemic, the Company expects to substantially limit acquisitions and will continue to monitor opportunities to dispose of additional properties. Both of its mixed-use projects in the Washington D.C. require minimal additional investment and leasing continues to make nice progress. Construction of the River Oaks residential tower has continued, leasing has recently begun and initial residential move-ins are expected in the third quarter.

The Board of Trust Managers declared a cash dividend of $0.18 per common share payable on September 15, 2020 to shareholders of record on September 8, 2020. As communicated last quarter, the Company will likely pay a regular cash dividend of $0.18 per share in each of the last two quarters of 2020 due to an election made last year to shift dividend payments from 2019 to 2020. The Company completed dispositions totaling $15 million in the quarter and closed the sale of its last center in Utah and a center in Los Angeles totaling an additional $43 million subsequent to quarter-end. As such, it is likely that the Company will need to pay a special dividend near year-end to cover additional 2020 taxable income resulting from these sales; however, the amount of any special dividend is uncertain at this time. The Company will continue to monitor tenant collections, evaluate its operations and financial position and will adjust future dividends as appropriate.

“With $498 million currently available under our revolver, cash collections trending at higher levels than originally projected, proceeds from additional dispositions and access to numerous other sources of capital, we remain comfortable with our ability to meet all liquidity needs going forward, including any additional dividends required by our disposition activity,” said Steve Richter, Executive Vice President and Chief Financial Officer.

Conference Call Information

The Company also announced that it will host a live webcast of its quarterly conference call on July 30, 2020 at 10:00 a.m. Central Time. The live webcast can be accessed via the Company’s website at www.weingarten.com. Alternatively, if you are not able to access the call on the web, you can listen live by phone by calling (888) 771-4371 (conference ID #49202522). A replay will be available through the Company’s website starting approximately two hours following the live call.

About Weingarten Realty Investors

Weingarten Realty Investors (NYSE: WRI) is a shopping center owner, manager and developer. At June 30, 2020, the Company owned or operated under long-term leases, either directly or through its interest in real estate joint ventures or partnerships, a total of 165 properties which are located in 16 states spanning the country from coast to coast. These properties represent approximately 31.4 million square feet of which our interests in these properties aggregated approximately 21.3 million square feet of leasable area. To learn more about the Company’s operations and growth strategies, please visit www.weingarten.com.

Forward-Looking Statements

Statements included herein that state the Company’s or Management’s intentions, hopes, beliefs, expectations or predictions of the future are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 which by their nature, involve known and unknown risks and uncertainties. The Company’s actual results, performance or achievements could differ materially from those expressed or implied by such statements. These risks and uncertainties include those related to the COVID-19 pandemic, about which there are still many unknowns, including the duration of the pandemic and the extent of its impact, as well as those discussed in the Company’s regulatory filings with the Securities and Exchange Commission, which include other information or factors that may impact the Company’s performance.

Projections involve numerous assumptions such as rental income (including assumptions on percentage rent), interest rates, tenant defaults, occupancy rates, volume and pricing of properties held for disposition, volume and pricing of acquisitions, expenses (including salaries and employee costs), insurance costs and numerous other factors. Not all of these factors are determinable at this time and actual results may vary from the projected results, and may be above or below the ranges indicated. The above ranges represents management’s estimate of results based upon these assumptions as of the date of this press release. Accordingly, there is no assurance that our projections will be realized.

Weingarten Realty Investors

(in thousands, except per share amounts)

Financial Statements

Three Months Ended

 

Six Months Ended

June 30,

 

June 30,

2020

 

2019

 

2020

 

2019

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

(Unaudited)

Revenues:
Rentals, net$

95,813

 

$

119,462

 

$

203,863

 

$

239,288

 

Other

2,322

 

3,198

 

5,624

 

6,510

 

Total Revenues

98,135

 

122,660

 

209,487

 

245,798

 

Operating Expenses:
Depreciation and amortization

37,627

 

34,967

 

74,283

 

68,939

 

Operating

19,978

 

22,767

 

43,138

 

47,015

 

Real estate taxes, net

15,733

 

15,736

 

30,741

 

31,867

 

Impairment loss

 

 

44

 

74

 

General and administrative

12,920

 

8,880

 

15,227

 

18,461

 

Total Operating Expenses

86,258

 

82,350

 

163,433

 

166,356

 

Other Income (Expense):
Interest expense, net

(15,776

)

(14,953

)

(30,378

)

(30,242

)

Interest and other income (expense), net

5,293

 

1,921

 

(535

)

6,305

 

Gain on sale of property

7,898

 

52,061

 

21,474

 

69,848

 

Total Other (Expense) Income

(2,585

)

39,029

 

(9,439

)

45,911

 

Income Before Income Taxes and Equity in Earnings of Real Estate Joint Ventures and Partnerships

9,292

 

79,339

 

36,615

 

125,353

 

Provision for Income Taxes

(343

)

(484

)

(515

)

(661

)

Equity in Earnings of Real Estate Joint Ventures and Partnerships, net

3,428

 

6,665

 

30,525

 

12,082

 

Net Income

12,377

 

85,520

 

66,625

 

136,774

 

Less: Net Income Attributable to Noncontrolling Interests

(1,009

)

(1,711

)

(2,635

)

(3,299

)

Net Income Attributable to Common Shareholders -- Basic$

11,368

 

$

83,809

 

$

63,990

 

$

133,475

 

Net Income Attributable to Common Shareholders -- Diluted$

11,368

 

$

84,337

 

$

63,990

 

$

134,531

 

Earnings Per Common Share -- Basic$

0.09

 

$

0.66

 

$

0.50

 

$

1.04

 

Earnings Per Common Share -- Diluted$

0.09

 

$

0.65

 

$

0.50

 

$

1.03

 

Weingarten Realty Investors

(in thousands)

Financial Statements

June 30,

 

December 31,

2020

 

2019

(Unaudited)

 

(Audited)

CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
Property$

4,202,337

 

$

4,145,249

 

Accumulated Depreciation

(1,156,304

)

(1,110,675

)

Property Held for Sale, net

24,421

 

 

Investment in Real Estate Joint Ventures and Partnerships, net

401,724

 

427,947

 

Unamortized Lease Costs, net

146,620

 

148,479

 

Accrued Rent, Accrued Contract Receivables and Accounts Receivable, net

73,760

 

83,639

 

Cash and Cash Equivalents

14,203

 

41,481

 

Restricted Deposits and Escrows

14,063

 

13,810

 

Other, net

186,385

 

188,004

 

Total Assets$

3,907,209

 

$

3,937,934

 

 
LIABILITIES AND EQUITY
Debt, net$

1,743,194

 

$

1,732,338

 

Accounts Payable and Accrued Expenses

97,776

 

111,666

 

Other, net

210,507

 

217,770

 

Total Liabilities

2,051,477

 

2,061,774

 

 
Commitments and Contingencies

 

 

 
EQUITY
Common Shares of Beneficial Interest

3,890

 

3,905

 

Additional Paid-In Capital

1,767,972

 

1,779,986

 

Net Income Less Than Accumulated Dividends

(85,008

)

(74,293

)

Accumulated Other Comprehensive Loss

(11,158

)

(11,283

)

Shareholders' Equity

1,675,696

 

1,698,315

 

Noncontrolling Interests

180,036

 

177,845

 

Total Liabilities and Equity$

3,907,209

 

$

3,937,934

 

Non-GAAP Financial Measures

Certain aspects of our key performance indicators are considered non-GAAP financial measures. Management uses these measures along with our Generally Accepted Accounting Principles ("GAAP") financial statements in order to evaluate our operating results. Management believes these additional measures provide users of our financial information additional comparable indicators of our industry, as well as, our performance.

Funds from Operations Attributable to Common Shareholders

Effective January 1, 2019, the National Association of Real Estate Investment Trusts ("NAREIT") defines NAREIT FFO as net income (loss) attributable to common shareholders computed in accordance with GAAP, excluding gains or losses from sales of certain real estate assets (including: depreciable real estate with land, land, development property and securities), changes in control of real estate equity investments, and interests in real estate equity investments and their applicable taxes, plus depreciation and amortization related to real estate and impairment of certain real estate assets and in substance real estate equity investments, including our share of unconsolidated real estate joint ventures and partnerships. The Company calculates NAREIT FFO in a manner consistent with the NAREIT definition.

Management believes NAREIT FFO is a widely recognized measure of REIT operating performance which provides our shareholders with a relevant basis for comparison among other REITs. Management uses NAREIT FFO as a supplemental internal measure to conduct and evaluate our business because there are certain limitations associated with using GAAP net income by itself as the primary measure of our operating performance. Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, management believes that the presentation of operating results for real estate companies that uses historical cost accounting is insufficient by itself. There can be no assurance that NAREIT FFO presented by the Company is comparable to similarly titled measures of other REITs.

The Company also presents Core FFO as an additional supplemental measure as it is more reflective of the core operating performance of our portfolio of properties. Core FFO is defined as NAREIT FFO excluding charges and gains related to non-cash, non-operating assets and other transactions or events that hinder the comparability of operating results. Specific examples of items excluded from Core FFO include, but are not limited to, gains or losses associated with the extinguishment of debt or other liabilities and transactional costs associated with development activities. NAREIT FFO and Core FFO should not be considered as alternatives to net income or other measurements under GAAP as indicators of operating performance or to cash flows from operating, investing or financing activities as measures of liquidity. NAREIT FFO and Core FFO do not reflect working capital changes, cash expenditures for capital improvements or principal payments on indebtedness.

NAREIT FFO and Core FFO is calculated as follows (in thousands):

Three Months Ended

 

Six Months Ended

June 30,

 

June 30,

2020

 

2019

 

2020

 

2019

(Unaudited)

 

(Unaudited)

Net income attributable to common shareholders

$

11,368

 

 

$

83,809

 

 

$

63,990

 

 

$

133,475

 

Depreciation and amortization of real estate

37,520

 

 

 

34,732

 

 

 

73,995

 

 

 

68,475

 

Depreciation and amortization of real estate of unconsolidated real estate joint ventures and partnerships

4,322

 

 

 

2,789

 

 

 

8,119

 

 

 

5,741

 

Impairment of properties and real estate equity investments

 

 

 

 

 

 

44

 

 

 

74

 

(Gain) on sale of property, investment securities and interests in real estate equity investments

(7,903

)

 

 

(51,605

)

 

 

(21,477

)

 

 

(70,554

)

(Gain) on dispositions of unconsolidated real estate joint ventures and partnerships

(1,044

)

 

 

(1,106

)

 

 

(23,416

)

 

 

(1,380

)

Provision for income taxes (1)

 

 

 

44

 

 

 

 

 

 

44

 

Noncontrolling interests and other (2)

(652

)

 

 

(484

)

 

 

(1,227

)

 

 

(973

)

NAREIT FFO – basic

43,611

 

 

 

68,179

 

 

 

100,028

 

 

 

134,902

 

Income attributable to operating partnership units

241

 

 

 

528

 

 

 

769

 

 

 

1,056

 

NAREIT FFO – diluted

43,852

 

 

 

68,707

 

 

 

100,797

 

 

 

135,958

 

Adjustments for Core FFO:

 

 

 

 

 

 

 

 

 

 

Contract terminations

 

 

 

 

 

 

340

 

 

 

 

Core FFO – diluted

$

43,852

 

 

$

68,707

 

 

$

101,137

 

 

$

135,958

 

 

 

 

 

 

 

 

 

 

 

 

FFO weighted average shares outstanding – basic

127,242

 

 

 

127,856

 

 

 

127,552

 

 

 

127,807

 

Effect of dilutive securities:

 

 

 

 

 

 

 

 

 

 

Share options and awards

861

 

 

 

847

 

 

 

899

 

 

 

841

 

Operating partnership units

1,432

 

 

 

1,432

 

 

 

1,432

 

 

 

1,432

 

FFO weighted average shares outstanding – diluted

129,535

 

 

 

130,135

 

 

 

129,883

 

 

 

130,080

 

NAREIT FFO per common share – basic

$

0.34

 

 

$

0.53

 

 

$

0.78

 

 

$

1.06

 

NAREIT FFO per common share – diluted

$

0.34

 

 

$

0.53

 

 

$

0.78

 

 

$

1.05

 

Core FFO per common share – diluted

$

0.34

 

 

$

0.53

 

 

$

0.78

 

 

$

1.05

 

__________________________

(1)

The applicable taxes related to gains and impairments of operating and non-operating real estate assets.

(2)

Related to gains, impairments and depreciation on operating properties and unconsolidated real estate joint ventures, where applicable.

Same Property Net Operating Income

Management considers SPNOI an important additional financial measure because it reflects only those income and expense items that are incurred at the property level and when compared across periods, reflects the impact on operations from trends in occupancy rates, rental rates and operating costs. The Company calculates this most useful measurement by determining our proportional share of SPNOI from all owned properties, including the Company’s share of SPNOI from unconsolidated joint ventures and partnerships, which cannot be readily determined under GAAP measurements and presentation. Although SPNOI (see page 1 of the supplemental disclosure regarding this presentation and limitations thereof) is a widely used measure among REITs, there can be no assurance that SPNOI presented by the Company is comparable to similarly titled measures of other REITs. Additionally, the Company does not control these unconsolidated joint ventures and partnerships, and the assets, liabilities, revenues or expenses of these joint ventures and partnerships, as presented, do not represent its legal claim to such items.

Properties are included in the SPNOI calculation if they are owned and operated for the entirety of the most recent two fiscal year periods, except for properties for which significant redevelopment or expansion occurred during either of the periods presented, and properties that have been sold. While there is judgment surrounding changes in designations, management moves new development and redevelopment properties once they have stabilized, which is typically upon attainment of 90% occupancy. A rollforward of the properties included in the Company’s same property designation is as follows:

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30, 2020

 

June 30, 2020

Beginning of the period

 

149

 

155

Properties removed:

 

 

 

 

Redevelopments

 

-

 

(2)

Dispositions

 

(1)

 

(5)

End of the period

 

148

 

148

The Company calculates SPNOI using net income attributable to common shareholders excluding net income attributable to noncontrolling interests, other income (expense), income taxes and equity in earnings of real estate joint ventures and partnerships. Additionally to reconcile to SPNOI, the Company excludes the effects of property management fees, certain non-cash revenues and expenses such as straight-line rental revenue and the related reversal of such amounts upon early lease termination, depreciation and amortization, impairment losses, general and administrative expenses and other items such as lease cancellation income, environmental abatement costs, demolition expenses and lease termination fees. Consistent with the capital treatment of such costs under GAAP, tenant improvements, leasing commissions and other direct leasing costs are excluded from SPNOI. A reconciliation of net income attributable to common shareholders to SPNOI is as follows (in thousands):

Three Months Ended

 

Six Months Ended

June 30,

 

June 30,

2020

 

2019

 

2020

 

2019

(Unaudited)

 

(Unaudited)

Net income attributable to common shareholders$

11,368

 

$

83,809

 

$

63,990

 

$

133,475

 

Add:
Net income attributable to noncontrolling interests

1,009

 

1,711

 

2,635

 

3,299

 

Provision for income taxes

343

 

484

 

515

 

661

 

Interest expense, net

15,776

 

14,953

 

30,378

 

30,242

 

Property management fees

829

 

683

 

1,907

 

1,556

 

Depreciation and amortization

37,627

 

34,967

 

74,283

 

68,939

 

Impairment loss

 

 

44

 

74

 

General and administrative

12,920

 

8,880

 

15,227

 

18,461

 

Other (1)

79

 

743

 

167

 

1,989

 

Less:
Gain on sale of property

(7,898

)

(52,061

)

(21,474

)

(69,848

)

Equity in earnings of real estate joint ventures and partnership interests, net

(3,428

)

(6,665

)

(30,525

)

(12,082

)

Interest and other (income) expense, net

(5,293

)

(1,921

)

535

 

(6,305

)

Revenue adjustments (2)

866

 

(3,060

)

3,991

 

(6,279

)

Adjusted income

64,198

 

82,523

 

141,673

 

164,182

 

Less: Adjusted income related to consolidated entities not defined as same property and noncontrolling interests

(5,831

)

(8,965

)

(10,760

)

(17,607

)

Add: Pro rata share of unconsolidated entities defined as same property

6,648

 

7,443

 

14,403

 

14,565

 

Same Property Net Operating Income$

65,015

 

$

81,001

 

$

145,316

 

$

161,140

 

_______________________

(1)

Other includes items such as environmental abatement costs, demolition expenses and lease termination fees.

(2)

Revenue adjustments consist primarily of straight-line rentals, lease cancellation income and fee income primarily from real estate joint ventures and partnerships.

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate

NAREIT defines EBITDAre as net income computed in accordance with GAAP, plus interest expense, income tax expense (benefit), depreciation and amortization and impairment of depreciable real estate and in substance real estate equity investments; plus or minus gains or losses from sales of certain real estate assets and interests in real estate equity investments; and adjustments to reflect our share of unconsolidated real estate joint ventures and partnerships for these items. The Company calculates EBITDAre in a manner consistent with the NAREIT definition.

As mentioned above, NAREIT FFO is a widely recognized measure of REIT operating performance which provides our shareholders with a relevant basis for comparing earnings performance among other REITs based upon the unique capital structure of each REIT. However as a basis of comparability that is independent of a company's capital structure, management believes that since EBITDA is a widely known and understood measure of performance, EBITDAre will represent an additional supplemental non-GAAP performance measure that will provide investors with a relevant basis for comparing REITs. There can be no assurance that EBITDAre as presented by the Company is comparable to similarly titled measures of other REITs.

The Company also presents Core EBITDAre as an additional supplemental measure as it is more reflective of the core operating performance of our portfolio of properties. Core EBITDAre is defined as NAREIT EBITDAre excluding charges and gains related to non-cash and non-operating transactions and other events that hinder the comparability of operating results. Specific examples of items excluded from Core EBITDAre include, but are not limited to, gains or losses associated with the extinguishment of debt or other liabilities, and transactional costs associated with development activities. EBITDAre and Core EBITDAre should not be considered as alternatives to net income or other measurements under GAAP as indicators of operating performance or to cash flows from operating, investing or financing activities as measures of liquidity. EBITDAre and Core EBITDAre do not reflect working capital changes, cash expenditures for capital improvements or principal payments on indebtedness.

EBITDAre and Core EBITDAre is calculated as follows (in thousands):

Three Months Ended

 

Six Months Ended

June 30,

 

June 30,

2020

 

2019

 

2020

 

2019

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre):
Net income$

12,377

$

85,520

$

66,625

$

136,774

Interest expense, net

15,776

14,953

30,378

30,242

Provision for income taxes

343

484

515

661

Depreciation and amortization of real estate

37,627

34,967

74,283

68,939

Impairment loss on operating properties and real estate equity investments

44

74

Gain on sale of property and investment securities (1)

(7,903)

(51,619)

(21,477)

(70,589)

EBITDAre adjustments of unconsolidated real estate joint ventures and partnerships, net (2)

4,195

2,643

(13,442)

6,267

Total EBITDAre

62,415

86,948

136,926

172,368

Adjustments for Core EBITDAre:
Contract terminations

340

Total Core EBITDAre$

62,415

$

86,948

$

137,266

$

172,368

__________________________

(1)

Includes a $.1 million gain on sale of non-operating assets for both the three and six months ended June 30, 2020 and a $.2 million gain on sale of non-operating assets for the six months ended June 30, 2019.

(2)

Includes a $1.0 million and $23.4 million gain on the sale of operating properties for the three and six months ended June 30, 2020, respectively, and a $1.1 million gain on sale of operating properties for both the three and six months ended June 30, 2019. Also includes $.3 million gain on sale of non-operating assets for the six months ended June 30, 2019.

 

Information: Michelle Wiggs, Phone: (713) 866-6050

Source: Weingarten Realty