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 CBL & Associates Properties Reports Results for Fourth Quarter and Full-Year 2016
   Wednesday, February 01, 2017 4:15:05 PM ET

CBL & Associates Properties, Inc. (CBL ) announced results for the fourth quarter and year ended December 31, 2016. 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                                                                                                 Year Ended
                                                                                                                                                             December 31,                                                                                                                      December 31,
                                                                                                            ----------------------------------------------------------------------------------------------------                               ---------------------------------------------------------------------------------------------------
                                                                                                                        2016                            2015                   %                                     2016                           2015                   %
                                                                                                            -----------------------------                     ------------------------------                     ---------                     -----------------------------                     -----------------------------                     ---------
Net income (loss) attributable to common shareholders per diluted                                            $ 0.34                         $ (0.20 )                                         270.0 %                        $ 0.75                         $ 0.34                        120.6 %
share
                                                                                                            == ==== ====================                      == ===== ====================                      ===== ==                      == ==== ====================                      == ==== ====================                      ===== ==
Funds from Operations ("FFO") per diluted share                                                              $ 0.72                         $  0.71                          1.4 %                        $ 2.69                         $ 2.41                         11.6 %
                                                                                                            == ==== ====================                      == ===== ====================                      ===== ==                      == ==== ====================                      == ==== ====================                      ===== ==
FFO, as adjusted, per diluted share (1)                                                                      $ 0.68                         $  0.71                         (4.2 )%                       $ 2.41                         $ 2.32                          3.9 %
                                                                                                            == ==== ====================                      == ===== ====================                      ===== ==                      == ==== ====================                      == ==== ====================                      ===== ==
(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 (loss) attributable to
common shareholders to FFO allocable to Operating Partnership
common unitholders on page 9 of this earnings release.
 


HIGHLIGHTS:

-- Same-center NOI increased 0.3% for the fourth quarter and 2.3% for the year ended December 31, 2016, over the prior-year periods.

-- 2016 FFO per diluted share, as adjusted, decreased 4.2% to $0.68 in the fourth quarter 2016 and increased 3.9% to $2.41 for 2016, compared with the prior-year periods.

-- Average gross rent per square foot increased 11.5% for stabilized mall leases signed in the fourth quarter 2016 and 7.6% for the full-year 2016 over the prior rate.

-- Total portfolio occupancy at December 31, 2016 was 94.8%, representing an increase of 120 basis points from the prior year-end.

-- Same-center sales per square foot for 2016 were $376, compared with $382 for 2015.

-- In 2016, CBL completed the disposition of interests in eight malls, five community centers and five office buildings, generating gross proceeds of more than $369 million.

-- In 2016, CBL completed more than $1.0 billion in financing activity, including closing a $400 million unsecured notes offering.

"2016 was an excellent year for CBL. Operationally we generated improved growth from our higher-quality portfolio with a same-center NOI increase of 2.3% and a 120 basis point improvement in occupancy. The progress we’ve made on our disposition program and focus on reducing debt has resulted in a balance sheet that is stronger and more flexible than ever. We meaningfully reduced shorter-term, floating rate debt through a well-executed 10-year unsecured bond offering in December and applied asset sales proceeds and cash flow to debt reduction, ending the year with our lowest debt balance in ten years.

"2017 represents a year of reinvention for the CBL portfolio as we embark on a number of transformational redevelopment projects at some of our best assets. With our track record of executing profitably on anchor redevelopments, we are excited about the opportunity to transform our properties to meet changing consumer preferences and attract high-quality in-demand uses, all while delivering enhanced returns to our shareholders."

Net income attributable to common shareholders for the fourth quarter 2016 was $57.6 million, or $0.34 per diluted share, compared with a net loss of $33.5 million, or $0.20 per diluted share for the fourth quarter 2015.

Net income attributable to common shareholders for 2016 was $128.0 million, or $0.75 per diluted share, compared with net income of $58.5 million, or $0.34 per diluted share for 2015.

FFO allocable to common shareholders, as adjusted, for the fourth quarter of 2016 was $116.6 million, or $0.68 per diluted share, compared with $120.4 million, or $0.71 per diluted share, for the fourth quarter of 2015. FFO allocable to the Operating Partnership common unitholders, as adjusted, for the fourth quarter of 2016 was $135.9 million compared with $141.0 million for the fourth quarter of 2015.

FFO allocable to common shareholders, as adjusted, for 2016 was $411.0 million, or $2.41 per diluted share, compared with $395.1 million, or $2.32 per diluted share, for 2015. FFO allocable to the Operating Partnership common unitholders, as adjusted, for 2016 was $480.8 million compared with $462.9 million for 2015.

Percentage change in same-center Net Operating Income ("NOI")(1):

                                    Three Months       Year Ended
                                                                       Ended December 31,                      December 31,
                                                                              2016                                 2016
                                                                       -------------------                     -------------
   Portfolio same-center NOI                                                 0.3 %                                  2.3 %
   Mall same-center NOI                                                      0.0 %                                  2.1 %
(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 2016

-- Revenues for 2016 grew $17.3 million as compared with 2015. Major items included: -- a $13.6 million increase in minimum rents;

-- a $1.0 million increase in percentage rents;

-- a $3.2 million increase in other rent and other income resulting primarily from increases in specialty leasing; and

-- a $0.5 million decline in tenant reimbursements.

-- Same-center expenses for 2016 were $0.9 million higher in 2016 compared with 2015. Major items included: -- a $1.4 million increase in maintenance and repair expenses primarily driven by higher maintenance and snow removal expenses;

-- a $2.5 million decline in operating expenses, primarily due to lower utility and central energy expenses and marketing and advertising expenses compared with the prior year, partially offset by an increase in seasonal expense; and

-- an increase of $2.0 million in real estate tax expenses.

PORTFOLIO OPERATIONAL RESULTS Occupancy:

                                               As of December 31,
                                                                         -------------------------------------------
                                                                            2016         2015
                                                                         -----------                     -----------
Portfolio occupancy                                                          94.8 %                          93.6 %
   Mall portfolio                                                            94.1 %                          93.1 %
      Same-center malls                                                      94.2 %                          93.7 %
      Stabilized malls                                                       94.2 %                          93.3 %
      Non-stabilized malls (1)                                               92.8 %                          91.3 %
   Associated centers                                                        96.9 %                          94.6 %
   Community centers                                                         98.2 %                          97.1 %
(1) Represents occupancy for The Outlet Shoppes at
Atlanta and The Outlet Shoppes of the Bluegrass as of December 31,
2016 and Fremaux Town Center, The Outlet Shoppes at Atlanta and
The Outlet Shoppes of the Bluegrass as of December 31, 2015.
 

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                 Year Ended
                                                                                                                                                                                                               Ended December 31,                                                   December 31,
                                                                                                                                                                                                                      2016                                                              2016
                                                                                                                                                                                                               -------------------                                          ----------------------------
Stabilized Malls                                                                                                                                                                                                    11.5 %                                                     7.6 %
   New leases                                                                                                                                                                                                       46.3 %                                                    28.2 %
   Renewal leases                                                                                                                                                                                                    2.2 %                                                     1.2 %
                                                                                                                                                                                                                                                                                    

Same-center Sales Per Square Foot for Mall Tenants 10,000 Square Feet or Less:

                                                                Year Ended December 31,         
                                                                                                                 ---------------------------------------
                                                                                                                   2016       2015                         % Change
                                                                                                                 ---------                     ---------                     ----------
Stabilized mall same-center sales per square foot                                                                  $ 376                         $ 382                       (1.6 )%
 

ANCHOR TRANSACTIONS

In January, CBL closed on a sale-leaseback transaction for five Sears department stores and two Sears Auto Centers located at CBL malls, providing CBL with control of these locations for future redevelopment.

CBL acquired the locations for a total consideration of $72.5 million. Sears will continue to operate the department stores under new 10-year leases. Under the terms of the leases, CBL will receive aggregate initial base rent of approximately $5.075 million, with Sears also responsible for paying common area maintenance charges, taxes, insurance and utilities. CBL will have the right to terminate each Sears lease at any time (except November through January), with six months advance notice.

Additionally in January, CBL closed on the acquisition of three Macy’s stores located at Jefferson Mall in Louisville, KY; Parkdale Mall in Beaumont, TX and Eastland Mall in Bloomington, IL, for future redevelopment. CBL acquired the locations for $5.0 million.

FINANCING ACTIVITY

During 2016, CBL completed more than $1.0 billion in financing activity including:

-- In December CBL’s majority-owned operating partnership subsidiary, CBL & Associates Limited Partnership, closed a $400 million offering of 5.95% Senior Notes Due 2026 (the "notes") under its existing shelf registration statement. The notes mature on December 15, 2026. Net proceeds from the offering were used to reduce amounts outstanding under the unsecured revolving credit facilities and for general business purposes.

-- During the fourth quarter, CBL closed on a $60.0 million ($30.0 million at CBL’s share) non-recourse loan secured by The Shops at Friendly Center in Greensboro, NC, which is owned in a 50/50 joint venture. The new loan has a term of six-years to coincide with the maturity date of the existing loan secured by The Friendly Center, and has a fixed interest rate of 3.34%. Proceeds were used to retire the maturing $37.6 million loan ($18.8 million at CBL’s share), which had a fixed interest rate of 5.9%, with excess proceeds used to reduce outstanding balances on the Company’s lines of credit.

-- In June, CBL closed three separate non-recourse secured loans with an aggregate borrowing amount of $227.7 million. The loans have a weighted average interest rate of 3.9% and a weighted average term of 9 years. The loans included a $47.7 million 7-year loan secured by Ambassador Town Center in Lafayette, LA, bearing a fixed rate of 3.22%; a 10-year non-recourse $73.0 million loan secured by Fremaux Town Center in Slidell, LA, bearing a fixed interest rate of 3.69% and a 10-year non-recourse $107.0 million loan secured by Hamilton Place in Chattanooga, TN, bearing a fixed interest rate of 4.36%.

-- Additionally, in June the foreclosure of Gulf Coast Town Center in Fort Myers, FL (owned in a 50/50 joint venture) was completed, reducing debt by $95.4 million, at CBL’s share.

CBL also completed four loan restructures in 2016, representing an aggregate loan balance of $162 million. The loans were restructured at a weighted average interest rate of 4.75%, representing a 188 basis point improvement over the prior weighted average rate.

-- In December, CBL closed on a restructure of the existing $46.7 million loan secured by Cary Towne Center in Cary, NC. The term of the loan was extended two years with an additional two-year extension available at the Company’s option for a final maturity of March 2021 and the interest rate reduced from 8.5% to 4.0%, interest only (retroactive to August 2016). Excess cash flow generated from the property will be used to fund a proposed redevelopment. More details of the project will be announced once finalized.

-- In December, CBL closed on a restructure of the existing $70.8 million loan secured by Greenbrier Mall in Chesapeake, VA. The term was extended three years with an additional one-year extension available at the Company’s option for a final maturity of December 2020. The interest rate was reduced from $5.91% to 5.0%, interest only.

-- In April, CBL closed on a restructure of the existing $27.4 million non-recourse loan secured by Hickory Point Mall in Forsyth, IL. The term of the loan was extended three years, with an additional one-year extension available at the Company’s option, for a final maturity of December 2019. The interest rate was maintained at 5.85%, with future amortization payments eliminated.

-- In February, CBL closed on a restructure of the existing $171.09 million ($17.1 million at CBL’s share) loan secured by Triangle Town Center in Raleigh, NC. The term was extended two years with two additional one-year extensions available at the Company’s option, for a final maturity date of December 2020. The interest rate was reduced to 4.0% from 5.74%.

Subsequent to the end of the fourth quarter, CBL retired loans secured by Hamilton Corner in Chattanooga, TN; The Plaza at Fayette Mall in Lexington, KY and The Plaza at St. Clair Square in Fairview Heights, IL. The aggregate balance retired was $70.1 million. The properties were added to CBL’s unencumbered pool. CBL’s consolidated unencumbered pool of properties currently represents nearly 53% of 2016 total consolidated NOI.

CBL currently has three properties in receivership with an aggregate loan balance of $189.6 million: Chesterfield Mall in Chesterfield, MO; Midland Mall in Midland, MI and Wausau Center in Wausau, WI. Foreclosure proceedings are in process and are expected to be finalized in early 2017.

DISPOSITIONS

During 2016, CBL completed dispositions of properties generating gross proceeds of $369.8 million and net proceeds of $225.7 million.

                                                                                                                                                                                                                                                         
Status/Timing                                              Property                                                                                                       Location                                                                                        CBL’s                                                                    CBL’s Share                                                                  CBL’s                                                                    CBL’s
                                                                                                                                                                                                                                                                        Ownership                                                                      of                                                                     Share of                                                                 Share of
                                                                                                                                                                                                                                                                                                                                                  Consideration                                                                 Debt                                                                    Equity
----------------                                           --------------------------------------------------------------------                                           ------------------------------------                                           -------------------------------------                                            --------------------------                                            ----------------------------------                                            -------------------------
Closed/December                                            Randolph Mall; Regency Mall; Walnut Square                                                                     Asheboro, NC; Racine, WI; Dalton, GA                                                           100 %                                                                               $   32.3                                                              $            0.0                                                              $  32.3
Closed/December                                            Regency Mall Outparcels                                                                                        Racine, WI                                                                                     100 %                                                                                    5.3                                                                --                                                                  5.3
Closed/July                                                Fashion Square/The Lakes Mall                                                                                  Saginaw, MI/Muskegon, MI                                                                       100 %                                                                                   66.5                                                                          38.2                                                                 28.3
Closed/May                                                 Bonita Lakes Mall & Crossing                                                                                   Meridian, MI                                                                                   100 %                                                                                   27.9                                                                --                                                                 27.9
Closed/March                                               River Ridge Mall (1)                                                                                           Lynchburg, VA                                                                  100% a’ 25%                                                                  33.5                                                                --                                                                 33.5
Closed/February                                            Triangle Town Center, Place and Commons (1)                                                                    Raleigh, NC                                                                     50% a’ 10%                                               69.6                                                       68.4                                               1.2
                                                                                                                                                                                                                                                                                                                                          -------------------- ------                                           -------------------- --------------                                           -------------------- -----
                                                                                                                                          Total Malls:                                                                                                                                                                                       235.1                                                      106.6                                             128.5
                                                                                                                                                                                                                                                                               -------------------- ------                                           -------------------- --------------                                           -------------------- -----
Closed/December                                            Friendly Center Office, Wachovia Office, First Citizens Bank, & Bank                                           Greensboro, NC                                                                                  50 %                                                                                   13.0                                                                --                                                                 13.0
                                                           of America
Closed/December                                            Triangle Town Place                                                                                            Raleigh, NC                                                                                     10 %                                                                                    3.0                                                                           2.9                                                                  0.1
Closed/December                                            Cobblestone Village                                                                                            Palm Coast, FL                                                                                 100 %                                                                                    8.5                                                                --                                                                  8.5
Closed/December                                            Atlanta Self Development                                                                                       Woodstock, GA                                                                                   65 %                                                                                    4.0                                                                           2.1                                                                  1.9
Closed/September                                           High Pointe Commons                                                                                            Harrisburg, PA                                                                                  50 %                                                                                   16.9                                                                           8.7                                                                  8.2
Closed/September                                           Oak Branch Business Center                                                                                     Greensboro, NC                                                                                 100 %                                                                                    2.4                                                                --                                                                  2.4
Closed/April                                               Renaissance Center                                                                                             Durham, NC                                                                                      50 %                                                                                   64.6                                                                          23.8                                                                 40.8
Closed/April                                               The Crossings at Marshall’s Creek                                                                              Middle Smithfield, PA                                                                          100 %                                                                22.3                                             --                                              22.3
                                                                                                                                                                                                                                                                                                                                          -------------------- ------                                           -------------------- --------------                                           -------------------- -----
                                                                                                                               Total Community Center and Office:                                                                                                                                                                            134.7                                                       37.5                                              97.2
                                                                                                                                                                                                                                                                               -------------------- ------                                           -------------------- --------------                                           -------------------- -----
                                                                                                                                   Total Disposition Activity:                                                                                                                                                                                               $  369.8                                                              $          144.1                                                              $ 225.7
                                                                                                                                                                                                                                                                               ==================== ======                                           ==================== ==============                                           ==================== =====
(1) Joint Venture amounts are reflected net of retained
interest.
 

Additionally, in January 2017, CBL closed on the sale of two wholly-owned office buildings in Newport News, VA for $6.25 million.

OUTLOOK AND GUIDANCE

The Company is providing 2017 FFO guidance in the range of $2.26 - $2.33 per share. CBL is assuming same-center NOI growth of 0.0% - 1.5% in 2017.

The guidance also assumes the following:

-- $8.0 million to $12.0 million of outparcel sales gains;

-- flat year-end total portfolio occupancy as well as stabilized mall occupancy;

-- G&A expense in the range of $62.0 - $64.0 million for the full year;

-- no unannounced capital markets or disposition activity.

                                                                                         Low                             High
                                                                                                                                                                           -----------------------------                                          -----------------------------
Expected diluted earnings per common share                                                                                                                                  $ 0.70                                                                 $ 0.77
Adjust to fully converted shares from common shares                                                                                                                          (0.10 )                                                                (0.11 )
                                                                                                                                                                           ----------------------------                                           ----------------------------
Expected earnings per diluted, fully converted common share                                                                                                                   0.60                                                                   0.66
Add: depreciation and amortization                                                                                                                                            1.56                                                                   1.56
Add: noncontrolling interest in earnings of Operating Partnership                                                                                                             0.10                                                0.11  
                                                                                                                                                                           ----------------------------                                           ----------------------------
Expected FFO per diluted, fully converted common share                                                                                                                      $ 2.26                                              $ 2.33  
                                                                                                                                                                           == ==== ====================                                           == ==== ====================
 

INVESTOR CONFERENCE CALL AND WEBCAST

CBL & Associates Properties, Inc. will conduct a conference call at 11:00 a.m. ET on Thursday, February 2, 2017, 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 enter the confirmation number 5940738. A replay of the conference call will be available through February 9, 2017, by dialing (877) 344-7529 or (412) 317-0088 and entering the confirmation number 10097491. 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 2016 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 Thursday, February 2, 2017 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 is one of the largest and most active owners and developers of malls and shopping centers in the United States. CBL owns, holds interests in or manages 128 properties, including 84 regional malls/open-air centers. The properties are located in 29 states and total 79.1 million square feet including 7.0 million square feet of non-owned shopping centers managed for third parties. Additional information can be found at 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 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 9 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.

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.

 
 
 
 
 
                                                                                                                                                                                         CBL & Associates Properties, Inc.
                                                                                                                                                                                                   Consolidated
                                                                                                                                                                                             Statements of Operations
                                                                                                                                                                                         (Unaudited; in thousands, except
                                                                                                                                                                                                per share amounts)
 
                                                                                                                         Three Months Ended                                                                                                         Year Ended
                                                                                                                                                                                     December 31,                                                                                                                                                 December 31,
                                                                                                                                 ------------------------------------------------------------------------------------------------------------                                                  -----------------------------------------------------------------------------------------------------------
                                                                                                                                                 2016                                     2015                                                                           2016                                     2015
                                                                                                                                 -------------------------------------                                          -------------------------------------                                          -------------------------------------                                          ------------------------------------
REVENUES:
   Minimum rents                                                                                                                       $ 168,276                                                                      $ 178,378                                                                      $ 670,565                                                                     $ 684,309
   Percentage rents                                                                                                                        7,213                                                                          7,645                                                                         17,803                                                                        18,063
   Other rents                                                                                                                             9,363                                                                          8,186                                                                         23,110                                                                        21,934
   Tenant reimbursements                                                                                                                  67,487                                                                         73,461                                                                        280,438                                                                       288,279
   Management, development and leasing fees                                                                                                4,100                                                                          2,758                                                                         14,925                                                                        10,953
   Other                                                                                                                                   2,054                                                       7,202                                                      21,416                                                     31,480  
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
      Total revenues                                                                                                                     258,493                                                     277,630                                                   1,028,257                                                  1,055,018  
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
OPERATING EXPENSES:
   Property operating                                                                                                                     32,956                                                                         33,401                                                                        137,760                                                                       141,030
   Depreciation and amortization                                                                                                          72,188                                                                         77,519                                                                        292,693                                                                       299,069
   Real estate taxes                                                                                                                      21,756                                                                         21,886                                                                         90,110                                                                        90,799
   Maintenance and repairs                                                                                                                14,012                                                                         12,413                                                                         53,586                                                                        51,516
   General and administrative                                                                                                             16,467                                                                         15,678                                                                         63,332                                                                        62,118
   Loss on impairment                                                                                                                         86                                                                        102,280                                                                        116,822                                                                       105,945
   Other                                                                                                                                      13                                                       5,766                                                      20,326                                                     26,957  
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
      Total operating expenses                                                                                                           157,478                                                     268,943                                                     774,629                                                    777,434  
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Income from operations                                                                                                                   101,015                                                                          8,687                                                                        253,628                                                                       277,584
   Interest and other income                                                                                                                 462                                                                            225                                                                          1,524                                                                         6,467
   Interest expense                                                                                                                      (53,608 )                                                                      (54,981 )                                                                     (216,318 )                                                                    (229,343 )
   Gain on extinguishment of debt                                                                                                 --                                                                 --                                                                 --                                                                           256
   Gain on investments                                                                                                                     7,534                                                                 --                                                                          7,534                                                                        16,560
   Equity in earnings of unconsolidated affiliates                                                                                        10,316                                                                          5,988                                                                        117,533                                                                        18,200
                                                                                                                                            (911 )                                                                         (937 )                                                                        2,063                                                     (2,941 )
   Income tax benefit (provision)
                                                                                                                                 --------------  --------------------                                           --------------  --------------------                                           --------------  --------------------                                           -------------  --------------------
Income (loss) from continuing operations before gain on sales of                                                                          64,808                                                                        (41,018 )                                                                      165,964                                                                        86,783
real estate assets
   Gain on sales of real estate assets                                                                                                    15,064                                                      14,065                                                      29,567                                                     32,232  
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Net income (loss)                                                                                                                         79,872                                                                        (26,953 )                                                                      195,531                                                                       119,015
   Net (income) loss attributable to noncontrolling interests in:
      Operating Partnership                                                                                                               (9,481 )                                                                        5,612                                                                        (21,537 )                                                                     (10,171 )
      Other consolidated subsidiaries                                                                                                     (1,561 )                                                                         (916 )                                                                       (1,112 )                                                                      (5,473 )
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Net income (loss) attributable to the Company                                                                                             68,830                                                                        (22,257 )                                                                      172,882                                                                       103,371
      Preferred dividends                                                                                                                (11,223 )                                                                      (11,223 )                                                                      (44,892 )                                                                     (44,892 )
                                                                                                                                 ------------------------------------                                           ------------------------------------                                           ------------------------------------                                           -----------------------------------
Net income (loss) attributable to common shareholders                                                                                  $  57,607                                                   $ (33,480 )                                                                    $ 127,990                                                  $  58,479  
                                                                                                                                 ======= ======= ====================                                           ======= ======= ====================                                           ======= ======= ====================                                           ====== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                               
Basic per share data attributable to common shareholders:
   Net income (loss) attributable to common shareholders                                                                               $    0.34                                                                      $   (0.20 )                                                                    $    0.75                                                                     $    0.34
   Weighted-average common shares outstanding                                                                                            170,793                                                                        170,495                                                                        170,762                                                                       170,476
                                                                                                                                                                                                                                                                                                                                                                               
Diluted per share data attributable to common shareholders:
   Net income (loss) attributable to common shareholders                                                                               $    0.34                                                                      $   (0.20 )                                                                    $    0.75                                                                     $    0.34
   Weighted-average common and potential dilutive common shares                                                                          171,089                                                                        170,495                                                                        170,836                                                                       170,499
   outstanding
 
 
 
 
 
 
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                                                                                   Year Ended
                                                                                                                                                           December 31,                                                                                                        December 31,
                                                                                                                  ----------------------------------------------------------------------------------------                            ----------------------------------------------------------------------------------------
                                                                                                                                  2016                                   2015                                                      2016                                   2015
                                                                                                                  -------------------------------------                     -------------------------------------                     -------------------------------------                     -------------------------------------
Net income (loss) attributable to common shareholders                                                                   $  57,607                                                 $ (33,480 )                                               $ 127,990                                                 $  58,479
Noncontrolling interest in income (loss) of Operating Partnership                                                           9,481                                                    (5,612 )                                                  21,537                                                    10,171
Depreciation and amortization expense of:
   Consolidated properties                                                                                                 72,188                                                    77,519                                                   292,693                                                   299,069
   Unconsolidated affiliates                                                                                                9,516                                                     9,122                                                    38,606                                                    40,476
   Non-real estate assets                                                                                                    (757 )                                                    (799 )                                                  (3,154 )                                                  (3,083 )
Noncontrolling interests’ share of depreciation and amortization                                                           (2,075 )                                                  (2,109 )                                                  (8,760 )                                                  (9,045 )
Loss on impairment, net of tax                                                                                                 37                                                   102,280                                                   115,027                                                   105,945
Gain on depreciable property, net of tax                                                                                   (1,535 )                                                  (5,899 )                                                 (45,741 )                                                 (20,944 )
                                                                                                                  ------------------------------------                      ------------------------------------                      ------------------------------------                      ------------------------------------
FFO allocable to Operating Partnership common unitholders                                                                 144,462                                                   141,022                                                   538,198                                                   481,068
     Litigation settlements, net of related expenses (1)                                                                      259                                            --                                                     2,567                                                    (1,329 )
     Nonrecurring professional fees expense (1)                                                                               477                                            --                                                     2,258                                            --
     Gain on investments, net of tax (2)                                                                                   (7,034 )                                          --                                                    (7,034 )                                                 (16,560 )
     Equity in earnings from disposals of unconsolidated affiliates (3)                                                    (3,758 )                                          --                                                   (58,243 )                                          --
     Non cash default interest expense                                                                                      1,466                                            --                                                     2,840                                            --
     Gain on extinguishment of debt                                                                                --                                            --                                            --                                                      (256 )
     Loss on extinguishment of debt from unconsolidated affiliates                                                 --                         --                                    197                         --  
                                                                                                                  ------------------------------------                      ------------------------------------                      ------------------------------------                      ------------------------------------
FFO allocable to Operating Partnership common unitholders, as                                                           $ 135,872                              $ 141,022                              $ 480,783                              $ 462,923  
adjusted
                                                                                                                  ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================
                                                                                                                                                                                                                                                                                                 
FFO per diluted share                                                                                                   $    0.72                              $    0.71                              $    2.69                              $    2.41  
                                                                                                                  ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================
                                                                                                                                                                                                                                                                                                 
FFO, as adjusted, per diluted share                                                                                     $    0.68                              $    0.71                              $    2.41                              $    2.32  
                                                                                                                  ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================
                                                                                                                                                                                                                                                                                                 
Weighted average common and potential dilutive common shares                                                              199,381                                                   199,753                                                   199,838                                                   199,757
outstanding with Operating Partnership units fully converted
                                                                                                                                                                                                                                                                                                 
(1) Litigation settlement is included in Interest and
Other Income in the Consolidated Statements of Operations.
Litigation expense, including settlements paid, is included in
General and Administrative expense in the Consolidated Statements
of Operations. Nonrecurring professional fees expense is included
in General and Administrative expense in the Consolidated
Statements of Operations.
                                                                                                                                                                                                                                                                                                 
(2) For the three months and the year ended December
31, 2016, includes a gain of $10,136 related to the redemption of
the Company’s 2007 investment in a Chinese real estate company,
less related taxes of $500, partially offset by a $2,602 loss
related to the Company’s exit from its consolidated joint venture
that provided security and maintenance services to third parties.
For the year ended December 31, 2015, includes a $16,560 gain
related to the sale of marketable securities.
                                                                                                                                                                                                                                                                                                 
(3) For the three months and the year ended December
31, 2016, includes $3,758 related to the sale of four office
buildings. For the year ended December 31, 2016, includes $28,146
related to the foreclosure of the loan secured by Gulf Coast Town
Center and $26,373 related to the sale of our 50% interest in
Triangle Town Center.
 
 
 
 
 
The reconciliation of diluted EPS to FFO per diluted share is as
follows:
 
                                                                                                                          Three Months Ended                                                                                               Year Ended
                                                                                                                                                                                      December 31,                                                                                                                                       December 31,
                                                                                                                                      -----------------------------------------------------------------------------------------------------                                                  --------------------------------------------------------------------------------------------
                                                                                                                                                      2016                                  2015                                                                   2016                             2015
                                                                                                                                      -------------------------------------                                          ------------------------------                                          -----------------------------                                          -----------------------------
Diluted EPS attributable to common shareholders                                                                                             $    0.34                                                                 $ (0.20 )                                                               $ 0.75                                                                 $ 0.34
Eliminate amounts per share excluded from FFO:
   Depreciation and amortization expense, including amounts from                                                                                 0.40                                                                    0.42                                                                   1.60                                                                   1.64
   consolidated properties, unconsolidated affiliates, non-real estate
   assets and excluding amounts allocated to noncontrolling interests
   Loss on impairment, net of tax                                                                                                      --                                                                    0.52                                                                   0.57                                                                   0.53
   Gain on depreciable property, net of tax                                                                                                     (0.02 )                                                                 (0.03 )                                                                (0.23 )                                                                (0.10 )
                                                                                                                                      ------------------------------------                                           -----------------------------                                           ----------------------------                                           ----------------------------
FFO per diluted share                                                                                                                       $    0.72                                              $  0.71                                              $ 2.69                                              $ 2.41  
                                                                                                                                      ======= ======= ====================                                           == ===== ====================                                           == ==== ====================                                           == ==== ====================
                                                                                                                                                                                                                                                                                                                                                                             

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                                                                             Year Ended
                                                                                                                                                                  December 31,                                                                                                  December 31,
                                                                                                                             --------------------------------------------------------------------------------                            -----------------------------------------------------------------------------------
                                                                                                                                           2016                               2015                                                  2016                                 2015
                                                                                                                             ---------------------------------                     ---------------------------------                     ---------------------------------                     ------------------------------------
FFO allocable to Operating Partnership common unitholders                                                                      $ 144,462                                             $ 141,022                                             $ 538,198                                                $ 481,068
Percentage allocable to common shareholders (1)                                                                                    85.79                    %                            85.35                    %                            85.48                    %                               85.35                    %
                                                                                                                             --------------------------------                      --------------------------------                      --------------------------------                      -----------------------------------
FFO allocable to common shareholders                                                                                           $ 123,934                          $ 120,362                          $ 460,052                             $ 410,592  
                                                                                                                             === ======= ====================                      === ======= ====================                      === ======= ====================                      ====== ======= ====================
                                                                                                                                                                                                                                                                                                
FFO allocable to Operating Partnership common unitholders, as                                                                  $ 135,872                                             $ 141,022                                             $ 480,783                                                  462,923
adjusted
Percentage allocable to common shareholders (1)                                                                                    85.79                    %                            85.35                    %                            85.48                    %                               85.35                    %
                                                                                                                             --------------------------------                      --------------------------------                      --------------------------------                      -----------------------------------
FFO allocable to common shareholders, as adjusted                                                                              $ 116,565                          $ 120,362                          $ 410,973                             $ 395,105  
                                                                                                                             === ======= ====================                      === ======= ====================                      === ======= ====================                      ====== ======= ====================
(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 14.
 
 
 
                                                                                                                Three Months Ended                                                                           Year Ended
                                                                                                                                                                            December 31,                                                                                                                   December 31,
                                                                                                                                        ----------------------------------------------------------------------------                                                  -------------------------------------------------------------------------------
                                                                                                                                                2016                     2015                                                           2016                       2015
                                                                                                                                        ---------------------                                          ---------------------                                          ---------------------                                          ------------------------
SUPPLEMENTAL FFO INFORMATION:
Lease termination fees                                                                                                                   $              9                                               $            276                                               $          2,211                                                   $          4,659
   Lease termination fees per share                                                                                                      $ --                                               $ --                                               $           0.01                                                   $           0.02
                                                                                                                                                                                                                                                                                                                                      
Straight-line rental income (including write-offs)                                                                                       $         (1,175 )                                             $          1,232                                               $           (985 )                                                 $          4,207
   Straight-line rental income (including write-offs) per share                                                                          $          (0.01 )                                             $           0.01                                               $ --                                                   $           0.02
                                                                                                                                                                                                                                                                                                                                      
Gains on outparcel sales                                                                                                                 $         13,269                                               $          5,779                                               $         21,621                                                   $          8,929
   Gains on outparcel sales per share                                                                                                    $           0.07                                               $           0.03                                               $           0.11                                                   $           0.04
                                                                                                                                                                                                                                                                                                                                      
Net amortization of acquired above- and below-market leases                                                                              $            301                                               $          1,316                                               $          3,066                                                   $          3,197
   Net amortization of acquired above- and below-market leases per share                                                                 $ --                                               $           0.01                                               $           0.02                                                   $           0.02
                                                                                                                                                                                                                                                                                                                                      
Net amortization of debt premiums and discounts                                                                                          $            519                                               $            404                                               $          2,519                                                   $          1,841
   Net amortization of debt premiums and discounts per share                                                                             $ --                                               $ --                                               $           0.01                                                   $           0.01
                                                                                                                                                                                                                                                                                                                                      
Income tax benefit (provision)                                                                                                           $           (911 )                                             $           (937 )                                             $          2,063                                                   $         (2,941 )
   Income tax benefit (provision) per share                                                                                              $ --                                               $ --                                               $           0.01                                                   $          (0.01 )
                                                                                                                                                                                                                                                                                                                                      
Abandoned projects expense                                                                                                               $            (12 )                                             $           (190 )                                             $            (56 )                                                 $         (2,373 )
   Abandoned projects expense per share                                                                                                  $ --                                               $ --                                               $ --                                                   $          (0.01 )
                                                                                                                                                                                                                                                                                                                                      
Gain (loss) on extinguishment of debt                                                                                                    $ --                                               $ --                                               $           (197 )                                                 $            256
   Gain (loss) on extinguishment of debt per share                                                                                       $ --                                               $ --                                               $ --                                                   $ --
                                                                                                                                                                                                                                                                                                                                      
Non cash default interest expense                                                                                                        $         (1,466 )                                             $ --                                               $         (2,840 )                                                 $ --
   Non cash default interest expense per share                                                                                           $          (0.01 )                                             $ --                                               $          (0.01 )                                                 $ --
                                                                                                                                                                                                                                                                                                                                      
Gain on investments, net of tax                                                                                                          $          7,034                                               $ --                                               $          7,034                                                   $         16,560
   Gain on investments, net of tax per share                                                                                             $           0.04                                               $ --                                               $           0.04                                                   $           0.08
                                                                                                                                                                                                                                                                                                                                      
Equity in earnings from disposals of unconsolidated affiliates                                                                           $          3,758                                               $ --                                               $         58,243                                                   $ --
   Equity in earnings from disposals of unconsolidated affiliates per                                                                    $           0.02                                               $ --                                               $           0.29                                                   $ --
   share
                                                                                                                                                                                                                                                                                                                                      
Interest capitalized                                                                                                                     $            690                                               $          1,027                                               $          2,302                                                   $          4,168
   Interest capitalized per share                                                                                                        $ --                                               $           0.01                                               $           0.01                                                   $           0.02
                                                                                                                                                                                                                                                                                                                                      
Litigation settlements, net of related expenses                                                                                          $           (259 )                                             $ --                                               $         (2,567 )                                                 $          1,329
   Litigation settlements, net of related expenses per share                                                                             $ --                                               $ --                                               $          (0.01 )                                                 $           0.01
                                                                                                                                                                                                                                                                                                                                      
Nonrecurring professional fees expense                                                                                                   $           (477 )                                             $ --                                               $         (2,258 )                                                 $ --
   Nonrecurring professional fees expense per share                                                                                      $ --                                               $ --                                               $          (0.01 )                                                 $ --
 
 
                                                                                                                                                                                                                                                                                                        As of December 31,
                                                                                                                                                                                                                                                                      ---------------------------------------------------------------------------------------
                                                                                                                                                                                                                                                                              2016                                                             2015
                                                                                                                                                                                                                                                                      ---------------------                                          ------------------------
Straight-line rent receivable                                                                                                                                                                                                                                          $         67,086                                                   $         67,477
 
 
 
 
Same-center Net Operating Income
(Dollars in thousands)
 
                                                                                                                                Three Months Ended                                                                                                                           Year Ended
                                                                                                                                                                         December 31,                                                                                                                                                December 31,
                                                                                                            --------------------------------------------------------------------------------------------------------------------------------                            --------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                      2016                                                       2015                                                                          2016                                                       2015
                                                                                                            ---------------------------------------------------------                     ---------------------------------------------------------                     ---------------------------------------------------------                     ---------------------------------------------------------
Net income (loss)                                                                                                              $         79,872                                                              $        (26,953 )                                                            $        195,531                                                              $        119,015
                                                                                                                                                                                                                                                                                                                                                       
Adjustments:
Depreciation and amortization                                                                                                            72,188                                                                        77,519                                                                       292,693                                                                       299,069
Depreciation and amortization from unconsolidated affiliates                                                                              9,516                                                                         9,122                                                                        38,606                                                                        40,476
Noncontrolling interests’ share of depreciation and amortization                                                                         (2,075 )                                                                      (2,109 )                                                                      (8,760 )                                                                      (9,045 )
in other consolidated subsidiaries
Interest expense                                                                                                                         53,608                                                                        54,981                                                                       216,318                                                                       229,343
Interest expense from unconsolidated affiliates                                                                                           6,296                                                                         6,591                                                                        26,083                                                                        35,464
Noncontrolling interests’ share of interest expense in other                                                                             (1,689 )                                                                      (1,670 )                                                                      (6,815 )                                                                      (6,760 )
consolidated subsidiaries
Abandoned projects expense                                                                                                                   12                                                                           190                                                                            56                                                                         2,373
Gain on sales of real estate assets                                                                                                     (15,064 )                                                                     (14,109 )                                                                     (29,567 )                                                                     (32,276 )
Gain on sales of real estate assets of unconsolidated affiliates                                                                         (4,090 )                                                                        (234 )                                                                     (97,430 )                                                                      (1,964 )
Gain on investments                                                                                                                      (7,534 )                                                              --                                                                        (7,534 )                                                                     (16,560 )
Gain on extinguishment of debt                                                                                                   --                                                                --                                                                --                                                                          (256 )
Loss on extinguishment of debt from unconsolidated affiliates                                                                    --                                                                --                                                                           197                                                                --
Loss on impairment                                                                                                                           86                                                                       102,280                                                                       116,822                                                                       105,945
Income tax (benefit) provision                                                                                                              911                                                                           937                                                                        (2,063 )                                                                       2,941
Lease termination fees                                                                                                                       (9 )                                                                        (277 )                                                                      (2,211 )                                                                      (4,660 )
Straight-line rent and above- and below-market lease amortization                                                                           874                                                                        (2,547 )                                                                      (2,081 )                                                                      (7,403 )
Net income attributable to noncontrolling interest in other                                                                              (1,561 )                                                                        (916 )                                                                      (1,112 )                                                                      (5,473 )
consolidated subsidiaries
General and administrative expenses                                                                                                      16,467                                                                        15,678                                                                        63,332                                                                        62,118
Management fees and non-property level revenues                                                                       (3,349 )                                                   (2,044 )                                                  (17,026 )                                                  (24,958 )
                                                                                                            -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
Operating Partnership’s share of property NOI                                                                                           204,459                                                                       216,439                                                                       775,039                                                                       787,389
Non-comparable NOI                                                                                                   (12,058 )                                                  (24,625 )                                                  (58,967 )                                                  (87,716 )
                                                                                                            -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
Total same-center NOI (1)                                                                                                      $        192,401                                           $        191,814                                           $        716,072                                           $        699,673  
                                                                                                            ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
Total same-center NOI percentage change                                                                                  0.3 %                                                                                                                                    2.3 %
                                                                                                            ==================== ============== ====================                                                                                                    ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                                                       
Malls                                                                                                                          $        176,858                                                              $        176,819                                                              $        656,158                                                              $        642,682
Associated centers                                                                                                                        8,762                                                                         8,644                                                                        33,338                                                                        32,001
Community centers                                                                                                                         5,067                                                                         4,549                                                                        19,603                                                                        17,686
Offices and other                                                                                                      1,714                                   1,802                                   6,973                                   7,304  
                                                                                                            -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
Total same-center NOI (1)                                                                                                      $        192,401                                           $        191,814                                           $        716,072                                           $        699,673  
                                                                                                            ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                                                       
Percentage Change:
Malls                                                                                                                                       0.0 %                                                                                                                                                       2.1 %
Associated centers                                                                                                                          1.4 %                                                                                                                                                       4.2 %
Community centers                                                                                                                          11.4 %                                                                                                                                                      10.8 %
Offices and other                                                                                                       (4.9 )%                                                                                                                                  (4.5 )%
                                                                                                            -------------------- -------------- --------------------                                                                                                    -------------------- -------------- --------------------
Total same-center NOI (1)                                                                                                0.3 %                                                                                                                                    2.3 %
                                                                                                            ==================== ============== ====================                                                                                                    ==================== ============== ====================
 
(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, 2016, 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, 2016. New
properties are excluded from same-center NOI, until they meet this
criteria. The only properties excluded from the same-center pool
that would otherwise meet this criteria are properties which are
either being considered for repositioning, minority interest
properties in which we own an interest of 25% or less, or where we
intend to renegotiate the terms of the debt secured by the
property or return the property to the lender.
 
 
 
 
Company’s Share of Consolidated and Unconsolidated Debt
(Dollars
in thousands)
 
                                                                                                                                                                                                                      As of December 31, 2016
                                                                                                                       ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    Fixed Rate                              Variable                                Total per                    Unamortized                      Total
                                                                                                                                                                                                                    Rate                                                                          Debt                                                              Deferred
                                                                                                                                                                                                                                                                                                Schedule                                                            Financing
                                                                                                                                                                                                                                                                                                                                                                      Costs
                                                                                                                       ---------------------------------                                             --------------------------------                                             ---------------------------------                                             -------------                                             ---------------------------------
Consolidated debt                                                                                                         $ 3,594,379                                                                  $   888,770                                                                   $ 4,483,149                                                                  $ (17,855 )                                                $ 4,465,294
Noncontrolling interests’ share of consolidated debt                                                                         (109,162 )                                                                     (7,504 )                                                                    (116,666 )                                                                      945                                                     (115,721 )
Company’s share of unconsolidated affiliates’ debt                                                                            530,062                                                    73,263                                                    603,325                                                  (2,806 )                                                    600,519  
                                                                                                                       -----------------------------------                                           ----------------------------------                                           -----------------------------------                                           ---------------                                           -----------------------------------
Company’s share of consolidated and unconsolidated debt                                                                   $ 4,015,279                                               $   954,529                                                $ 4,969,808                                               $ (19,716 )                                                $ 4,950,092  
                                                                                                                       ==== ========= ====================                                           === ========= ====================                                           ==== ========= ====================                                           === ======= ===                                           ==== ========= ====================
Weighted average interest rate                                                                                                   5.30 %                                                                       2.18 %                                                                        4.70 %
 
 
                                                                                                                                                                                                                                                                               As of December 31, 2015
                                                                                                                       ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    Fixed Rate                                                                    Variable                                                                      Total per                                       Unamortized                                                            Total
                                                                                                                                                                                                                    Rate                                                                          Debt                                                              Deferred
                                                                                                                                                                                                                                                                                                Schedule                                                            Financing
                                                                                                                                                                                                                                                                                                                                                                      Costs
                                                                                                                       ---------------------------------                                             --------------------------------                                             ---------------------------------   --------------------                      -------------                                             ---------------------------------
Consolidated debt                                                                                                         $ 3,485,308                                                                  $ 1,241,379                                                                   $ 4,726,687                                                                  $ (16,059 )                                                $ 4,710,628
Noncontrolling interests’ share of consolidated debt                                                                         (111,754 )                                                                     (6,981 )                                                                    (118,735 )                                                                      855                                                     (117,880 )
Company’s share of unconsolidated affiliates’ debt                                                                            664,249                                                   134,970                                                    799,219                                                  (1,486 )                                                    797,733  
                                                                                                                       -----------------------------------                                           ----------------------------------                                           -----------------------------------                                           ---------------                                           -----------------------------------
Company’s share of consolidated and unconsolidated debt                                                                   $ 4,037,803                                               $ 1,369,368                                                $ 5,407,171                                               $ (16,690 )                                                $ 5,390,481  
                                                                                                                       ==== ========= ====================                                           === ========= ====================                                           ==== ========= ====================                                           === ======= ===                                           ==== ========= ====================
Weighted average interest rate                                                                                                   5.41 %                                                                       1.81 %                                                                        4.50 %
 
 
Debt-To-Total-Market Capitalization Ratio as of December 31,
2016
(In thousands, except stock price)
 
                                                                     Shares     Stock Price (1)                   Value
                                                                                                         Outstanding
                                                                                                        ----------                       ------------                        -----------------------------------
Common stock and Operating Partnership units                                                            199,085                               $  11.50                            $ 2,289,478
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                                                                                                                                                                 2,915,728
Company’s share of total debt, excluding unamortized deferred                                                                                                                       4,969,808  
financing costs
                                                                                                                                                                             ---------------  --------------------
Total market capitalization                                                                                                                                                       $ 7,885,536  
                                                                                                                                                                             ====== ========= ====================
Debt-to-total-market capitalization ratio                                                                                                                                                63.0 %
                                                                                                                                                                              
(1) Stock price for common stock and Operating Partnership units
equals the closing price of the common stock on December 30, 2016.
The stock prices for the preferred stocks represent the liquidation
preference of each respective series.
 
 
 
 
Reconciliation of Shares and Operating Partnership Units
Outstanding
(In thousands)
 
                                                                                                                       Three Months Ended                                                                                                                                    Year Ended
                                                                                                                                                                                   December 31,                                                                                                                                                                            December 31,
                                                                                                                  --------------------------------------------------------------------------------------------------------------------------------------                                                  --------------------------------------------------------------------------------------------------------------------------------------
2016:                                                                                                                                    Basic                                                Diluted                                                                                      Basic                                                Diluted
                                                                                                                  --------------------------------------------------                                          --------------------------------------------------                                          --------------------------------------------------                                          --------------------------------------------------
Weighted average shares - EPS                                                                                                          170,793                                                                                     171,089                                                                                     170,762                                                                                     170,836
Weighted average Operating Partnership units                                                                         28,292                                                28,292                                                29,002                                                29,002  
                                                                                                                  -------------------- ------- --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
Weighted average shares - FFO                                                                                       199,085                                               199,381                                               199,764                                               199,838  
                                                                                                                  ==================== ======= ====================                                           ==================== ======= ====================                                           ==================== ======= ====================                                           ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                       
2015:
Weighted average shares - EPS                                                                                                          170,495                                                                                     170,495                                                                                     170,476                                                                                     170,499
Weighted average Operating Partnership units                                                                         29,258                                                29,258                                                29,258                                                29,258  
                                                                                                                  -------------------- ------- --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
Weighted average shares - FFO                                                                                       199,753                                               199,753                                               199,734                                               199,757  
                                                                                                                  ==================== ======= ====================                                           ==================== ======= ====================                                           ==================== ======= ====================                                           ==================== ======= ====================
 
 
Dividend Payout Ratio
 
                                                                                                                                                                                Three Months Ended                                                                                                                                                                          Year Ended
                                                                                                                                                                                   December 31,                                                                                                                                                                            December 31,
                                                                                                                  --------------------------------------------------------------------------------------------------------------------------------------                                                  --------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                         2016                                                                                        2015                                                                                        2016                                                                                        2015
                                                                                                                  --------------------------------------------------                                          --------------------------------------------------                                          --------------------------------------------------                                          --------------------------------------------------
Weighted average cash dividend per share                                                                                             $ 0.27283                                                                                   $ 0.27279                                                                                   $ 1.09121                                                                                   $ 1.09116
FFO as adjusted, per diluted fully converted share                                                                                   $    0.68                                                                $    0.71                                                                $    2.41                                                                $    2.32  
                                                                                                                  -------------------- ------- --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
Dividend payout ratio                                                                                                  40.1 %                                                                   38.4 %                                                                   45.3 %                                                                   47.0 %
                                                                                                                  ==================== ======= ====================                                           ==================== ======= ====================                                           ==================== ======= ====================                                           ==================== ======= ====================
 
 
 
 
Consolidated Balance Sheets
(Unaudited; in thousands, except share data)
                                                                                                                               As of December 31,
                                                                                                                                     -------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                       2016                                       2015
                                                                                                                                     ----------------------------------------                                          ---------------------------------------
ASSETS
  Real estate assets:
     Land                                                                                                                                   $   831,979                                                                      $   876,668
     Buildings and improvements                                                                                                               6,942,452                                                     7,287,862  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
                                                                                                                                              7,774,431                                                                        8,164,530
     Accumulated depreciation                                                                                                                (2,427,108 )                                                                     (2,382,568 )
                                                                                                                                     ---------------------------------------                                           --------------------------------------
                                                                                                                                              5,347,323                                                                        5,781,962
     Held for sale                                                                                                                                5,861                                                                   --
     Developments in progress                                                                                                                   167,355                                                        75,991  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
       Net investment in real estate assets                                                                                                   5,520,539                                                                        5,857,953
  Cash and cash equivalents                                                                                                                      18,951                                                                           36,892
  Receivables:
                                                                                                                                                 94,676                                                                           87,286
     Tenant, net of allowance for doubtful accounts of $1,910 and
     $1,923 in 2016 and 2015, respectively
                                                                                                                                                  6,227                                                                           17,958
     Other, net of allowance for doubtful accounts of $838 and $1,276
     in 2016 and 2015, respectively
  Mortgage and other notes receivable                                                                                                            16,803                                                                           18,238
  Investments in unconsolidated affiliates                                                                                                      266,872                                                                          276,383
  Intangible lease assets and other assets                                                                                                      180,572                                                       185,281  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
                                                                                                                                            $ 6,104,640                                                   $ 6,479,991  
                                                                                                                                     ======== ========= ====================                                           ======= ========= ====================
                                                                                                                                                                                                                        
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
  Mortgage and other indebtedness                                                                                                           $ 4,465,294                                                                      $ 4,710,628
  Accounts payable and accrued liabilities                                                                                                      280,498                                                       344,434  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
     Total liabilities                                                                                                                        4,745,792                                                     5,055,062  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
  Commitments and contingencies
     Redeemable noncontrolling interests                                                                                                         17,996                                                        25,330  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
  Shareholders’ equity:
     Preferred stock, $.01 par value, 15,000,000 shares authorized:
                                                                                                                                                     18                                                                               18
     7.375% Series D Cumulative Redeemable Preferred Stock, 1,815,000
     shares outstanding
                                                                                                                                                      7                                                                                7
     6.625% Series E Cumulative Redeemable Preferred Stock, 690,000
     shares outstanding
                                                                                                                                                  1,708                                                                            1,705
     Common stock, $.01 par value, 350,000,000 shares authorized,
     170,792,645 and 170,490,948 issued and outstanding in 2016 and
     2015, respectively
     Additional paid-in capital                                                                                                               1,969,059                                                                        1,970,333
     Accumulated other comprehensive income                                                                                              --                                                                            1,935
     Dividends in excess of cumulative earnings                                                                                                (742,078 )                                                                       (689,028 )
                                                                                                                                     ---------------------------------------                                           --------------------------------------
       Total shareholders’ equity                                                                                                             1,228,714                                                                        1,284,970
  Noncontrolling interests                                                                                                                      112,138                                                       114,629  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
       Total equity                                                                                                                           1,340,852                                                     1,399,599  
                                                                                                                                     ---------------------------------------                                           --------------------------------------
                                                                                                                                            $ 6,104,640                                                   $ 6,479,991  
                                                                                                                                     ======== ========= ====================                                           ======= ========= ====================
                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                          

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20170201006285r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20170201006285/en/

SOURCE: CBL & Associates Properties, Inc.

CBL & Associates Properties, Inc. 
Katie Reinsmidt, 423-490-8301 
Senior Vice President - Investor Relations/Corporate Investments 
katie.reinsmidt@cblproperties.com


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