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Cousins Properties Inc. Reports Operating Results (10-Q)

November 08, 2010 | About:
10qk

10qk

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Cousins Properties Inc. (CUZ) filed Quarterly Report for the period ended 2010-09-30.

Cousins Properties Inc. has a market cap of $778.52 million; its shares were traded at around $7.65 with and P/S ratio of 3.46. CUZ is in the portfolios of Chris Davis of Davis Selected Advisers, Chuck Royce of Royce& Associates, Bruce Kovner of Caxton Associates, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC, Ruane Cunniff of Ruane & Cunniff & Goldfarb Inc.

Highlight of Business Operations:

Multi-family Residential Sales and Cost of Sales. Multi-family residential unit sales and cost of sales decreased approximately $2.6 million (28%) and $2.2 million (30%), respectively, between the three month 2010 and 2009 periods. Multi-family residential sales and cost of sales increased approximately $14.3 million and $10.7 million, respectively, between the nine month 2010 and 2009 periods. Closings at the Companys projects are detailed as follows:

Residential Lot and Outparcel Sales and Cost of Sales. Residential lot and outparcel sales and cost of sales decreased $520,000 and $430,000 between the three month 2010 and 2009 periods, respectively. Residential lot and outparcel sales and cost of sales increased $7.7 million and $5.2 million between the nine month 2010 and 2009 periods, respectively.

Outparcel Sales and Cost of Sales Outparcel sales and cost of sales decreased $1.1 million and $929,000, respectively, between the three month 2010 and 2009 periods. There were no outparcel sales in the three month 2010 period compared to one outparcel sale in the 2009 three month period. Outparcel sales and costs of sales increased $7.8 million and $5.0 million between the nine month 2010 and 2009 periods, respectively. There were eight outparcel sales in the nine month 2010 period, compared to three outparcel sales in the same 2009 period.

Other Income. Other income decreased $430,000 and $2.4 million between the three month and nine month 2010 and 2009 periods, respectively. Termination fees decreased by $235,000 and $1.7 million between the three and nine month 2010 and 2009 periods, respectively, due to a higher number of tenants at several retail centers ending their leases in early 2009 compared to a smaller number in 2010. In addition, interest income declined $612,000 in the nine month 2010 period compared to the same 2009 period, mainly due to a reduction in notes receivable outstanding between the nine month periods, although amounts were relatively constant between the three month periods.

Impairment Loss. The impairment loss of $586,000 for the nine month 2010 period relates to a charge taken on the Companys 60 North Market condominium project. The Company revised its estimates of sales timing and pricing for its remaining retail units in the second quarter 2010, resulting in the impairment loss. In the second quarter of 2009, the Company recorded an impairment loss of $34.9 million on its 10 Terminus Place condominium project. A loss of $1.6 million on a mezzanine note receivable was also recognized in the second quarter 2009, related to a project that was foreclosed upon in the third quarter of 2009. An impairment of approximately $4.0 million was

Other Expense. Other expense decreased $759,000 (44%) and $2.2 million (29%) between the three and nine month 2010 periods, respectively, compared to the same 2009 periods. Both the three and nine month 2010 periods had reduced funding costs for completed condominium projects. As units are sold, the percentage of costs the Company has to fund declines. In addition, two predevelopment projects totaling $4.1 million were written off in the nine month 2009 period, and one predevelopment project of $1.9 million was written off in the nine month 2010 period.

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