Vornado Announces Fourth Quarter 2012 Financial Results

Vornado Announces Fourth Quarter 2012 Financial Results

PARAMUS, N.J.--(BUSINESS WIRE)-- VORNADO REALTY TRUST (New York Stock Exchange: VNO) filed its Form 10-K for the year ended December 31, 2012 today and reported:

Fourth Quarter 2012 Results


NET INCOME attributable to common shareholders for the quarter ended December 31, 2012 was $62.6 million, or $0.33 per diluted share, compared to $69.5 million, or $0.37 per diluted share for the quarter ended December 31, 2011. Net income for the quarters ended December 31, 2012 and 2011 includes $281.5 million and $1.9 million, respectively, of net gains on sale of real estate, and $117.9 million and $28.8 million, respectively, of real estate impairment losses. In addition, the quarters ended December 31, 2012 and 2011 include certain other items that affect comparability which are listed in the table below. Adjusting net income attributable to common shareholders for net gains on sale of real estate, real estate impairment losses and the items in the table below, net of amounts attributable to noncontrolling interests, net income attributable to common shareholders for the quarters ended December 31, 2012 and 2011 was $81.3 million and $20.9 million, or $0.43 and $0.11 per diluted share, respectively.

FUNDS FROM OPERATIONS attributable to common shareholders plus assumed conversions ("FFO") for the quarter ended December 31, 2012 was $55.9 million, or $0.30 per diluted share, compared to $280.4 million, or $1.46 per diluted share for the prior year's quarter. Adjusting FFO for certain items that affect comparability which are listed in the table below, FFO for the quarters ended December 31, 2012 and 2011 was $228.6 million and $197.9 million, or $1.22 and $1.03 per diluted share, respectively.

(Amounts in thousands, except per share amounts)

For the Quarters Ended December 31,

2012

2011

FFO (1)

$

55,890

$

280,369

Per Share

$

0.30

$

1.46

Items that affect comparability income (expense):

Non-cash impairment loss on J.C. Penney owned shares

$

(224,937

)

$

-

(Loss) income from the mark-to-market of J.C. Penney derivative position

(22,472

)

40,120

Non-cash impairment loss on investment in Toys

(40,000

)

-

Accelerated amortization of discount on investment in subordinated debt of Independence Plaza

60,396

-

1290 Avenue of the Americas and 555 California Street priority return and income tax benefit

25,260

-

Net gain resulting from Lexington Realty Trust's stock issuance

14,116

-

FFO attributable to discontinued operations, including our share of discontinued operations

of Alexander's

12,736

25,398

Recognition of disputed receivable from Stop & Shop

-

23,521

Other, net

(8,825

)

(1,014

)

(183,726

)

88,025

Noncontrolling interests' share of above adjustments

11,056

(5,532

)

Items that affect comparability, net

$

(172,670

)

$

82,493

FFO as adjusted for comparability

$

228,560

$

197,876

Per Share

$

1.22

$

1.03

____________________________________________________________

(1)

See page 4 for a reconciliation of our net income to FFO for the quarters ended December 31, 2012 and 2011.

Year Ended 2012 Results

NET INCOME attributable to common shareholders for the year ended December 31, 2012 was $549.3 million, or $2.94 per diluted share, compared to $601.8 million, or $3.23 per diluted share for the year ended December 31, 2011. Net income for the years ended December 31, 2012 and 2011 includes $487.4 million and $61.4 million, respectively, of net gains on sale of real estate, and $141.6 million and $28.8 million, respectively, of real estate impairment losses. In addition, the years ended December 31, 2012 and 2011 include certain other items that affect comparability which are listed in the table below. Adjusting net income attributable to common shareholders for net gains on sale of real estate, real estate impairment losses and the items in the table below, net of amounts attributable to noncontrolling interests, net income attributable to common shareholders for the years ended December 31, 2012 and 2011 was $384.4 million and $314.1 million, or $2.06 and $1.68 per diluted share, respectively.

FFO for the year ended December 31, 2012 was $818.6 million, or $4.39 per diluted share, compared to $1,231.0 million, or $6.42 per diluted share for the prior year. Adjusting FFO for certain items that affect comparability which are listed in the table below, FFO for the years ended December 31, 2012 and 2011 was $964.1 million and $939.3 million, or $5.17 and $4.90 per diluted share, respectively.

(Amounts in thousands, except per share amounts)

For the Years Ended December 31,

2012

2011

FFO (1)

$

818,565

$

1,230,973

Per Share

$

4.39

$

6.42

Items that affect comparability income (expense):

Non-cash impairment loss on J.C. Penney owned shares

$

(224,937

)

$

-

(Loss) income from the mark-to-market of J.C. Penney derivative position

(75,815

)

12,984

Non-cash impairment loss on investment in Toys

(40,000

)

-

FFO attributable to discontinued operations, including our share of discontinued operations

of Alexander's

68,501

91,938

Accelerated amortization of discount on investment in subordinated debt of Independence Plaza

60,396

-

1290 Avenue of the Americas and 555 California Street priority return and income tax benefit

25,260

-

After-tax net gain on sale of Canadian Trade Shows

19,657

-

Net gain resulting from Lexington Realty Trust's stock issuance

14,116

9,760

Net gain on extinguishment of debt

-

83,907

Mezzanine loan loss reversal and gain on disposition

-

82,744

Recognition of disputed receivable from Stop & Shop

-

23,521

Other, net

(2,339

)

6,440

(155,161

)

311,294

Noncontrolling interests' share of above adjustments

9,601

(19,594

)

Items that affect comparability, net

$

(145,560

)

$

291,700

FFO as adjusted for comparability

$

964,125

$

939,273

Per Share

$

5.17

$

4.90

____________________________________________________________

(1)

See page 4 for a reconciliation of our net income to FFO for the years ended December 31, 2012 and 2011.

Supplemental Financial Information

Further details regarding the Company's results of operations, properties and tenants can be accessed at the Company's website www.vno.com. Vornado Realty Trust is a fully - integrated equity real estate investment trust.

Certain statements contained herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. For a discussion of factors that could materially affect the outcome of our forward-looking statements and our future results and financial condition, see "Risk Factors" in Part I, Item 1A, of our Annual Report on Form 10-K for the year ended December 31, 2012. Such factors include, among others, risks associated with the timing of and costs associated with property improvements, financing commitments and general competitive factors.

VORNADO REALTY TRUST

OPERATING RESULTS FOR THE QUARTERS AND YEARS ENDED

DECEMBER 31, 2012 AND 2011

For The Quarters

For The Years

(Amounts in thousands, except per share amounts)

Ended December 31,

Ended December 31,

2012

2011

2012

2011

Revenues

$

697,654

$

689,959

$

2,766,457

$

2,732,836

Income from continuing operations

50,432

105,275

408,599

578,885

Income (loss) from discontinued operations

41,461

(8,288

)

285,942

161,115

Net income

91,893

96,987

694,541

740,000

Less net income attributable to noncontrolling interests in:

Consolidated Subsidiaries

(1,090

)

(1,143

)

(32,018

)

(21,786

)

Operating Partnership

(3,882

)

(4,674

)

(35,327

)

(41,059

)

Preferred unit distributions of the Operating Partnership

(786

)

(3,874

)

(9,936

)

(14,853

)

Net income attributable to Vornado

86,135

87,296

617,260

662,302

Preferred share dividends

(20,750

)

(17,788

)

(76,937

)

(65,531

)

Discount on preferred share and unit redemptions

(2,752

)

-

8,948

5,000

Net income attributable to common shareholders

$

62,633

$

69,508

$

549,271

$

601,771

Net income per common share:

Basic

$

0.34

$

0.38

$

2.95

$

3.26

Diluted

$

0.33

$

0.37

$

2.94

$

3.23

Weighted average shares:

Basic

186,267

184,571

185,810

184,308

Diluted

186,866

185,963

186,530

186,021

FFO attributable to common shareholders plus assumed conversions

$

55,890

$

280,369

$

818,565

$

1,230,973

Per diluted share

$

0.30

$

1.46

$

4.39

$

6.42

FFO as adjusted for comparability

$

228,560

$

197,876

$

964,125

$

939,273

Per diluted share

$

1.22

$

1.03

$

5.17

$

4.90

Weighted average shares used in determining FFO per diluted share

186,866

191,751

186,530

191,757

The following table reconciles our net income to FFO:

For The Quarters

For The Years

(Amounts in thousands)

Ended December 31,

Ended December 31,

2012

2011

2012

2011

Reconciliation of our net income to FFO:

Net income attributable to Vornado

$

86,135

$

87,296

$

617,260

$

662,302

Depreciation and amortization of real property

125,069

152,655

504,407

530,113

Net gains on sale of real estate

(41,998

)

-

(245,799

)

(51,623

)