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Equity One Inc. Reports Operating Results (10-Q/A)
Posted by: gurufocus (IP Logged)
Date: November 23, 2011 04:33PM

Equity One Inc. (EQY) filed Amended Quarterly Report for the period ended 2011-06-30. Equity One Inc. has a market cap of $1.82 billion; its shares were traded at around $15.89 with a P/E ratio of 17 and P/S ratio of 6.4. The dividend yield of Equity One Inc. stocks is 5.5%. Equity One Inc. had an annual average earning growth of 2.7% over the past 5 years.



Highlight of Business Operations:

The effect on the condensed consolidated balance sheet at March 31, 2011 is a decrease to total stockholders’ equity of Equity One, Inc. of $26.4 million to $1.4 billion and an increase to noncontrolling interests of $26.4 million to $210.1 million. For the three months ended March 31, 2011, the effects on the condensed consolidated statement of income are a decrease to the gain on bargain purchase of $26.4 million to $27.1 million, which decreases net income attributable to Equity One, Inc. by the same amount to $32.1 million. Basic and diluted earnings per share for the three months ended March 31, 2011 have been restated to $0.30 and $0.29, respectively, from $0.54 and $0.51, respectively, as a result of this error.

The effect on the condensed consolidated balance sheet at June 30, 2011 is a decrease to total stockholders’ equity of Equity One, Inc. of $26.4 million to $1.5 billion and an increase to noncontrolling interests of $26.4 million to $209.8 million. There is no change to the condensed consolidated statement of income for the three months ended June 30, 2011 and the related earnings per share. For the six months ended June 30, 2011, the effects on the condensed consolidated statement of income is a decrease to the gain on bargain purchase of $26.4 million to $27.1 million, which decreases net income attributable to Equity One, Inc. by the same amount to $39.6 million. For the six months ended June 30, 2011, basic and diluted earnings per share were restated to $0.36 and $0.36, respectively, from $0.61 and $0.59, respectively, as a result of this error.

We use the equity method of accounting for investments in unconsolidated joint ventures when we own more than 20% but less than 50% of the voting interests and have significant influence but do not have a controlling financial interest, or if we own less than 20% of the voting interests but have determined that we have significant influence. Under the equity method, we record our investments in and advances to these entities in our consolidated balance sheets and our proportionate share of earnings or losses earned by the joint venture is recognized in equity in income (loss) of unconsolidated joint ventures in the accompanying consolidated statements of income. We derive revenue through our involvement with unconsolidated joint ventures in the form of management and leasing services and interest earned on loans and advances. We account for these revenues gross of our ownership interest in each respective joint venture and record our proportionate share of related expenses in equity in income (loss) of unconsolidated joint ventures.

Equity in income (loss) in unconsolidated joint ventures totaled approximately $177,000 and $811,000 for the three and six months ended June 30, 2011, respectively, and totaled $(42,000) and $(82,000), respectively, for the same periods in 2010. Fees paid to us associated with these joint ventures, which are included in management and leasing services revenue in the accompanying condensed consolidated statements of income, totaled approximately $547,000 and $914,000 for the three and six months ended June 30, 2011, respectively, and $381,000 and $741,000, respectively, for the three and six months ended June 30, 2010.

The joint venture shares received by LIH are redeemable for cash or, solely at our option, our common stock on a one-for-one basis, subject to certain adjustments. LIH’s ability to participate in earnings of CapCo is limited to their right to receive distributions payable on their joint venture shares. These non-elective distributions are designed to mirror dividends paid on our common stock. As such, earnings attributable to the noncontrolling interest as reflected in our condensed consolidated statements of income will be limited to distributions made to LIH on their joint venture shares. Distributions to LIH during the three and six months ended June 30, 2011 were $2.1 million and $4.5 million, respectively, which were equivalent to the per share dividends declared on our common stock, except for certain pro-rations as stipulated by the terms of the transaction.

Read the The complete Report



Stocks Discussed: EQY,
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