BEVERLY HILLS, Calif., Nov 07, 2011 (BUSINESS WIRE) -- Kennedy-Wilson Holdings, Inc.(NYSE: KW)
("Kennedy Wilson" or the "Company"), an international real estate
investment and services company, today reported a third quarter 2011 net
loss attributable to common shareholders of $6.9 million (or $0.16 per
basic and diluted share) compared to $6.7 million (or $0.17 per basic
and diluted share) for the same period in 2010. Net loss attributable to
common shareholders, adjusted for the non-recurring stock-based
compensation expense, was $5.6 million (or $0.13 per basic share)
compared to $4.7 million (or $0.12 per basic share) for the same period
in 2010.
The Company's earnings before interest, taxes, depreciation and
stock-based and merger-related compensation expense ("Adjusted EBITDA")
for the three and nine months ended September 30, 2011 were $9.0 million
and $41.6 million, respectively, compared to $13.6 million and $44.1
million for the same periods in 2010, respectively.
"The company had many outstanding achievements in the third quarter,
particularly in Europe, which we believe will become a major part of our
business in the next three to five years," said William McMorrow,
chairman and CEO of Kennedy Wilson. "We continue to increase our assets
under management and generate recurring income from our investments and
services businesses. Based on the fees we have already earned, we have
started the fourth quarter on a very strong note, and we continue to
execute on our growth strategy, which we outlined at the beginning of
2010."
Kennedy Wilson Recent Highlights
Investments
-
Kennedy Wilson's investment account (the Company's equity in real
estate, loan investments, and marketable securities) increased by
$133.2 million, or 36.6%, to $496.9 million as of September 30, 2011
from $363.7 million as of December 31, 2010. Subsequent to
September 30, 2011, the Company increased its investment account to
approximately $644.6 million, primarily as a result of its
participation in the acquisition of the loan portfolio in the United
Kingdom, its purchase of 180.2 million units of ordinary stock of the
Bank of Ireland and the acquisition of four office buildings in Los
Angeles.
-
During the nine months ended September 30, 2011, the Company, through
consolidated and joint venture investments, closed or is under
contract to close, approximately $3.1 billion of real estate
acquisitions. The Company's acquisitions (together with its
institutional partner's) and deals under contract since 2010 total
approximately $5.1 billion.
Services
-
The estimated value of the assets under the Company's management
("AUM") increased from approximately $7 billion at December 31, 2010
to approximately $10 billion at September 30, 2011. Subsequent to
September 30, 2011, the estimated value of Company's AUM increased to
approximately $12 billion, primarily as a result of its participation
in the acquisition of the loan portfolio in the United Kingdom.
-
Kennedy Wilson auctioned and conventionally sold approximately $200
million of properties in CA, OR, WA, FL, TX, SC, UT, and NC from
January 1, 2011 through September 30, 2011.
Europe
-
In June 2011, Kennedy Wilson Europe was established with offices in
Dublin, Ireland and London, England, also securing a contract to
manage AUM with an estimated value of approximately $2.3 billion
constituting real estate primarily located in Western Europe.
-
During the three months ended September 2011, Kennedy Wilson was
involved in the investment by several parties of $1.5 billion in
equity in the Bank of Ireland. The transaction closed in two tranches.
The first tranche closed in July 2011 and the Company earned a $1.9
million transaction fee at the closing. The second tranche closed in
October 2011 and the Company earned a $6.4 million transaction fee at
the closing.
-
In August 2011, Kennedy Wilson, along with its institutional partners,
agreed to acquire a portfolio consisting of 27 performing loans with
an unpaid principal balance ("UPB") of approximately $2.3 billion
($1.8 billion purchase price) secured by real estate located in the
United Kingdom. The parties closed the first of two tranches in the
transaction on October 21, 2011 for $1.4 billion in equity. The
closing of the second tranche of loans is expected to occur on or
around November 29, 2011 for $400 million. The 27 loans are secured by
more than 170 properties comprising the following product types: 38%
office, 25% multifamily, 25% retail, 9% industrial, 2% hotel and 1%
land. 60% of the UPB is located in London, England. The loans have a
26-month weighted average maturity and a 5.5% weighted average current
interest yield (based on purchase price). Kennedy Wilson has a 50%
ownership interest (representing an investment by Kennedy Wilson of
$47.8 million) in a joint venture that contributed $351.6 million,
which was partially funded with a $256.0 million loan that is
non-recourse to Kennedy Wilson currently bearing interest at a rate of
6% and secured by the joint venture's interest, for a 25.0% ownership
interest in the first tranche. Additionally, Kennedy Wilson
contributed $67.6 million for a 4.8% direct ownership interest in the
first tranche. The aforementioned joint venture, in which Kennedy
Wilson owns a 50% interest, is expected to take a 25% interest in the
closing of the second tranche. Kennedy Wilson charged a 1% acquisition
fee (based on purchase price) on the transaction and expects to earn
approximately $6 million in asset management fees over the 3-year
estimated holding period. Additionally, Kennedy Wilson is entitled to
promoted interests above certain return thresholds with respect to its
investment in the aforementioned joint venture. If these promoted
interests are attained, they will allow the Company to earn a larger
share of the profits than it would otherwise attain solely through its
ownership interest in the joint venture.
Debt Financing and Capital Markets
-
Since January 2010, the Company has raised approximately $4.5 billion
of debt and equity corporate capital and joint venture capital to
pursue its investment program.
-
In April 2011, the Company completed the sale and issuance of $250
million in aggregate principal amount of senior notes.
-
During the nine months ended September 30, 2011, the Company, through
consolidated and joint venture investments, completed $473 million of
property level financings in the United States and Japan at a weighted
average interest rate of 3.26%.
-
In June 2011, the Company issued 4.8 million shares of common stock to
institutional investors for gross proceeds of $51.4 million.
Multifamily Platform
-
Kennedy Wilson's current multifamily platform consists of 12,738 units
within 77 apartment communities. The Company owns 204 units through a
consolidated subsidiary and has equity investments in joint ventures
that own 12,534 units. The units are located in California (53%), the
Pacific Northwest (28%), and Japan (19%).
-
The Company's multifamily portfolio is 95% occupied and, on a trailing
12-month basis, produced an annualized net operating income of $122
million (annualized for communities purchased in 2011 and assuming
stabilization for one community in lease-up). The current debt
associated with these properties is approximately $1.4 billion, and
Kennedy Wilson's aggregate equity investment in the portfolio is
approximately 31% of the total equity invested in the portfolio. In
many cases, in addition to its ownership percentage, the Company has a
promoted interest in the profits of these investments. Management
believes that the Company's multifamily investments are generally in
supply constrained markets that will experience rent growth over the
next several years.
-
From time to time, depending on market conditions and pricing, Kennedy
Wilson plans to sell certain multifamily properties. Currently, the
Company is marketing five multifamily properties for sale.
Conference Call and Webcast Details
The company will hold a live conference call and webcast to discuss
results on Tuesday, November 8 at 7:00 a.m. PT/ 10:00 a.m. ET.
The direct dial-in number for the conference call is (866) 730-5766 for
U.S. and Canada callers and (857) 350-1590 for international
callers. The access code for the live call is 67073106.
A replay of the call will be available for one week beginning two hours
after the live call and can be accessed by (888) 286.8010 for
U.S. and Canada callers and (617) 801-6888 for international
callers. The access code for the replay is 63292834.
The webcast will be available at: http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=217898&eventID=4220820.
A replay of the webcast will be available two hours after the original
webcast on the Company's investor relations web site for one year.
About Kennedy Wilson
Founded in 1977, Kennedy Wilson is an international real estate
investment and services company headquartered in Beverly Hills, CA with
23 offices in the U.S., Europe and Japan. The Company offers a
comprehensive array of real estate services including auction,
conventional sales, property services and investment management. Through
its fund management and separate account businesses, Kennedy Wilson is a
strategic investor of real estate investments in the U.S., Europe and
Japan. For further information on Kennedy Wilson, please visit www.kennedywilson.com.
Forward-Looking Statements
Statements made by us in this report and in other reports and statements
released by us that are not historical facts constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of
1933, as amended (the "Securities Act") and Section 21 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). These
forward-looking statements are necessarily estimates reflecting the
judgment of our senior management based on our current estimates,
expectations, forecasts and projections and include comments that
express our current opinions about trends and factors that may impact
future operating results. Disclosures that use words such as "believe,"
"anticipate," "estimate," "intend," "could," "plan," "expect," "project"
or the negative of these, as well as similar expressions, are intended
to identify forward-looking statements. These statements are not
guarantees of future performance, rely on a number of assumptions
concerning future events, many of which are outside of our control, and
involve known and unknown risks and uncertainties that could cause our
actual results, performance or achievement, or industry results, to
differ materially from any future results, performance or achievements,
expressed or implied by such forward-looking statements. These risks and
uncertainties may include these factors and the risks and uncertainties
described elsewhere in this report and other filings with the Securities
and Exchange Commission (the "SEC"), including the Item 1A. "Risk
Factors" section of our Annual Report on Form 10-K for the year ended
December 31, 2010. Any such forward-looking statements, whether made in
this report or elsewhere, should be considered in the context of the
various disclosures made by us about our businesses including, without
limitation, the risk factors discussed in our filings with the SEC.
Except as required under the federal securities laws and the rules and
regulations of the SEC, we do not have any intention or obligation to
update publicly any forward-looking statements, whether as a result of
new information, future events, changes in assumptions, or otherwise.
Non-GAAP Financial Information
In addition to the results reported in accordance with U.S. generally
accepted accounting principles (GAAP) included within this press
release, Kennedy Wilson has provided certain information, which includes
non-GAAP financial measures (pro forma Statements of Income, Adjusted
Net (Loss) Income Attributable to Kennedy Wilson Common Shareholders,
Basic Adjusted Net (Loss) Income Attributable to Kennedy Wilson Common
Shareholders Per Share, EBITDA and Adjusted EBITDA). Such information is
reconciled to its closest GAAP measure in accordance with the SEC rules
and is included in the attached supplemental data. Management believes
that these non-GAAP financial measures are useful to both management and
the Company's shareholders in their analysis of the business and
operating performance of the Company. Management also uses this
information for operational planning and decision-making purposes.
Non-GAAP financial measures are not and should not be considered a
substitute for any GAAP measures. Additionally, non-GAAP financial
measures as presented by Kennedy Wilson may not be comparable to
similarly titled measures reported by other companies.
AUM generally refers to the properties and other assets with respect to
which we provide (or participate in) oversight, investment management
services and other advice, and which generally consist of real estate
properties or loans, and investments in joint ventures. Our AUM is
intended principally to reflect the extent of our presence in the real
estate market, not the basis for determining our management fees. Our
material assets under management consist of the total estimated fair
market value of the real estate properties and other assets either
wholly-owned or held by joint ventures and other entities in which our
sponsored funds or investment vehicles and client accounts have
invested. Committed (but unfunded) capital from investors in our
sponsored funds is not included in this component of our AUM. The
estimated value of development properties is included at estimated
completion cost.
|
| Kennedy-Wilson Holdings, Inc. and Subsidiaries |
| Consolidated Balance Sheets |
|
|
|
|
|
|
|
September 30, 2011
|
|
December 31, 2010
|
|
|
(unaudited) |
|
|
| Assets |
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
147,414,000
|
|
|
$
|
46,968,000
|
|
|
Accounts receivable
|
|
1,951,000
|
|
|
2,097,000
|
|
|
Accounts receivable -- related parties
|
|
10,596,000
|
|
|
7,062,000
|
|
|
Notes receivable
|
|
16,946,000
|
|
|
20,264,000
|
|
|
Notes receivable -- related parties
|
|
22,292,000
|
|
|
3,837,000
|
|
|
Real estate, net
|
|
113,619,000
|
|
|
82,701,000
|
|
|
Investments in joint ventures ($45,127,000 and $34,654,000 carried
at fair value
as of September 30, 2011 and December 31, 2010)
|
|
345,038,000
|
|
|
266,853,000
|
|
|
Loan pool participations
|
|
31,590,000
|
|
|
25,218,000
|
|
|
Marketable securities
|
|
5,658,000
|
|
|
33,000
|
|
|
Other assets
|
|
20,940,000
|
|
|
8,850,000
|
|
|
Goodwill
|
|
23,965,000
|
|
|
23,965,000
|
|
| Total assets |
|
$
|
740,009,000
|
|
|
$
|
487,848,000
|
|
| Liabilities and equity |
|
|
|
|
| Liabilities |
|
|
|
|
|
Accounts payable
|
|
$
|
353,000
|
|
|
$
|
1,504,000
|
|
|
Accrued expenses and other liabilities
|
|
30,896,000
|
|
|
9,064,000
|
|
|
Accrued salaries and benefits
|
|
5,014,000
|
|
|
10,721,000
|
|
|
Accrued and deferred tax liability
|
|
22,572,000
|
|
|
25,871,000
|
|
|
Senior notes payable
|
|
249,372,000
|
|
|
--
|
|
|
Notes payable
|
|
--
|
|
|
24,783,000
|
|
|
Borrowings under line of credit
|
|
--
|
|
|
27,750,000
|
|
|
Mortgage loans payable
|
|
38,217,000
|
|
|
35,249,000
|
|
|
Junior subordinated debentures
|
|
40,000,000
|
|
|
40,000,000
|
|
| Total liabilities |
|
386,424,000
|
|
|
174,942,000
|
|
| Equity |
|
|
|
|
|
Cumulative preferred stock, $0.0001 par value: 1,000,000 shares
authorized
$1,000 per share liquidation preference,
|
|
|
|
|
|
6.00% Series A, 100,000 shares issued as of September 30, 2011 and
December
31, 2010, mandatorily convertible on May 19, 2015
|
|
--
|
|
|
--
|
|
6.46% Series B, 32,550 shares issued as of September 30, 2011 and
December
31, 2010, mandatorily convertible on November 3, 2018
|
|
--
|
|
|
--
|
|
|
Common stock, $0.0001 par value: 125,000,000 shares authorized,
46,089,646
and 41,291,596 shares issued and 44,974,706 and
40,179,906 shares
outstanding as of September 30, 2011 and
December 31, 2010, respectively
|
|
5,000
|
|
|
4,000
|
|
|
Additional paid-in capital
|
|
337,988,000
|
|
|
284,669,000
|
|
|
Retained earnings
|
|
3,890,000
|
|
|
17,777,000
|
|
|
Accumulated other comprehensive income
|
|
7,467,000
|
|
|
9,043,000
|
|
|
Common stock held in treasury, at cost, $0.0001 par value,
1,114,940 and
1,111,690 held at September 30, 2011 and
December 31, 2010, respectively
|
|
(11,337,000
|
)
|
|
(11,301,000
|
)
|
| Total Kennedy-Wilson Holdings, Inc. shareholders' equity |
|
338,013,000
|
|
|
300,192,000
|
|
|
Noncontrolling interests
|
|
15,572,000
|
|
|
12,714,000
|
|
| Total equity |
|
353,585,000
|
|
|
312,906,000
|
|
| Total liabilities and equity |
|
$
|
740,009,000
|
|
|
$
|
487,848,000
|
|
|
| Kennedy-Wilson Holdings, Inc. and Subsidiaries |
| Consolidated Statements of Operations and Comprehensive (Loss)
Income |
| (Unaudited) |
|
|
|
|
|
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
| Revenue |
|
|
|
|
|
|
|
|
|
Management and leasing fees
|
|
$
|
4,862,000
|
|
|
$
|
2,300,000
|
|
|
$
|
9,657,000
|
|
|
$
|
6,513,000
|
|
|
Management and leasing fees -- related party
|
|
2,989,000
|
|
|
3,829,000
|
|
|
8,151,000
|
|
|
9,589,000
|
|
|
Commissions
|
|
1,329,000
|
|
|
1,973,000
|
|
|
4,842,000
|
|
|
4,353,000
|
|
|
Commissions -- related party
|
|
1,930,000
|
|
|
2,034,000
|
|
|
3,587,000
|
|
|
4,319,000
|
|
|
Sale of real estate
|
|
--
|
|
|
--
|
|
|
417,000
|
|
|
3,937,000
|
|
|
Rental and other income
|
|
1,666,000
|
|
|
1,637,000
|
|
|
3,359,000
|
|
|
2,934,000
|
|
| Total revenue |
|
12,776,000
|
|
|
11,773,000
|
|
|
30,013,000
|
|
|
31,645,000
|
|
| Operating expenses |
|
|
|
|
|
|
|
|
|
Commission and marketing expenses
|
|
1,641,000
|
|
|
263,000
|
|
|
3,015,000
|
|
|
2,032,000
|
|
|
Compensation and related expenses
|
|
8,473,000
|
|
|
12,414,000
|
|
|
24,562,000
|
|
|
29,400,000
|
|
|
Cost of real estate sold
|
|
--
|
|
|
--
|
|
|
397,000
|
|
|
2,714,000
|
|
|
General and administrative
|
|
3,329,000
|
|
|
3,457,000
|
|
|
9,183,000
|
|
|
8,263,000
|
|
|
Depreciation and amortization
|
|
931,000
|
|
|
616,000
|
|
|
1,828,000
|
|
|
1,197,000
|
|
|
Rental operating expenses
|
|
1,195,000
|
|
|
897,000
|
|
|
2,248,000
|
|
|
1,421,000
|
|
| Total operating expenses |
|
15,569,000
|
|
|
17,647,000
|
|
|
41,233,000
|
|
|
45,027,000
|
|
|
Equity in joint venture (loss) income
|
|
(646,000
|
)
|
|
5,191,000
|
|
|
7,229,000
|
|
|
5,162,000
|
|
|
Interest income from loan pool participations and notes receivable
|
|
1,048,000
|
|
|
4,209,000
|
|
|
5,835,000
|
|
|
7,950,000
|
|
| Operating income (loss) |
|
(2,391,000
|
)
|
|
3,526,000
|
|
|
1,844,000
|
|
|
(270,000
|
)
|
| Non-operating income (expense) |
|
|
|
|
|
|
|
|
|
Interest income
|
|
74,000
|
|
|
53,000
|
|
|
264,000
|
|
|
168,000
|
|
|
Interest income -- related party
|
|
561,000
|
|
|
91,000
|
|
|
970,000
|
|
|
477,000
|
|
|
Remeasurement gain
|
|
--
|
|
|
--
|
|
|
6,348,000
|
|
|
2,108,000
|
|
|
Gain on extinguishment of debt
|
|
--
|
|
|
--
|
|
|
--
|
|
|
16,670,000
|
|
|
Loss on extinguishment of debt
|
|
--
|
|
|
(4,788,000
|
)
|
|
--
|
|
|
(4,788,000
|
)
|
|
Interest expense
|
|
(6,117,000
|
)
|
|
(2,198,000
|
)
|
|
(13,874,000
|
)
|
|
(6,492,000
|
)
|
| (Loss) income before benefit from (provision for) income taxes |
|
(7,873,000
|
)
|
|
(3,316,000
|
)
|
|
(4,448,000
|
)
|
|
7,873,000
|
|
|
Benefit from (provision for) income taxes
|
|
2,997,000
|
|
|
(383,000
|
)
|
|
2,162,000
|
|
|
(4,335,000
|
)
|
| Net (loss) income |
|
(4,876,000
|
)
|
|
(3,699,000
|
)
|
|
(2,286,000
|
)
|
|
3,538,000
|
|
|
Net loss (income) attributable to the noncontrolling interests
|
|
42,000
|
|
|
(1,215,000
|
)
|
|
(1,295,000
|
)
|
|
(2,374,000
|
)
|
| Net (loss) income attributable to Kennedy-Wilson Holdings, Inc. |
|
(4,834,000
|
)
|
|
(4,914,000
|
)
|
|
(3,581,000
|
)
|
|
1,164,000
|
|
|
Preferred dividends and accretion of preferred stock issuance costs
|
|
(2,036,000
|
)
|
|
(1,804,000
|
)
|
|
(6,708,000
|
)
|
|
(2,524,000
|
)
|
Net loss attributable to Kennedy-Wilson Holdings, Inc. common
shareholders |
|
(6,870,000
|
)
|
|
(6,718,000
|
)
|
|
(10,289,000
|
)
|
|
(1,360,000
|
)
|
|
Other comprehensive (loss) income, net of tax
|
|
(1,783,000
|
)
|
|
2,912,000
|
|
|
(1,576,000
|
)
|
|
5,098,000
|
|
| Total comprehensive (loss) income |
|
$
|
(8,653,000
|
)
|
|
$
|
(3,806,000
|
)
|
|
$
|
(11,865,000
|
)
|
|
$
|
3,738,000
|
|
| Basic and diluted loss per share |
|
|
|
|
|
|
|
|
|
Basic and diluted loss attributable to Kennedy-Wilson Holdings, Inc.
common shareholders
|
|
$
|
(0.16
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(0.03
|
)
|
|
Weighted average number of common shares outstanding
|
|
44,016,880
|
|
|
38,961,822
|
|
|
40,712,496
|
|
|
39,062,570
|
|
|
Dividends declared per common share
|
|
$
|
0.04
|
|
|
$
|
--
|
|
|
$
|
0.08
|
|
|
$
|
--
|
|
|
| Kennedy-Wilson Holdings, Inc. and Subsidiaries |
| Proforma Statements of (Loss) Income |
| (Unaudited) |
|
|
|
|
|
Three Months Ended September 30, |
|
|
2011 |
|
2010 |
|
|
Consolidated |
|
Pro Rata Unconsolidated Investments |
|
Proforma Total |
|
Consolidated |
|
Pro Rata Unconsolidated Investments |
|
Proforma Total |
| Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
Management and leasing fees
|
|
$
|
7,851,000
|
|
|
$
|
--
|
|
|
$
|
7,851,000
|
|
|
$
|
6,129,000
|
|
|
$
|
--
|
|
|
$
|
6,129,000
|
|
|
Commissions
|
|
3,259,000
|
|
|
--
|
|
|
3,259,000
|
|
|
4,007,000
|
|
|
--
|
|
|
4,007,000
|
|
|
Sale of real estate
|
|
--
|
|
|
3,029,000
|
|
|
3,029,000
|
|
|
--
|
|
|
1,173,000
|
|
|
1,173,000
|
|
|
Rental and other income
|
|
1,666,000
|
|
|
12,655,000
|
|
|
14,321,000
|
|
|
1,637,000
|
|
|
15,205,000
|
|
|
16,842,000
|
|
|
Interest income
|
|
--
|
|
|
2,459,000
|
|
|
2,459,000
|
|
|
--
|
|
|
4,932,000
|
|
|
4,932,000
|
|
| Total revenue |
|
12,776,000
|
|
|
18,143,000
|
|
|
30,919,000
|
|
|
11,773,000
|
|
|
21,310,000
|
|
|
33,083,000
|
|
| Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commission and marketing expenses
|
|
1,641,000
|
|
|
--
|
|
|
1,641,000
|
|
|
263,000
|
|
|
--
|
|
|
263,000
|
|
|
Compensation and related expenses
|
|
8,473,000
|
|
|
--
|
|
|
8,473,000
|
|
|
12,414,000
|
|
|
--
|
|
|
12,414,000
|
|
|
Cost of real estate sold
|
|
--
|
|
|
2,522,000
|
|
|
2,522,000
|
|
|
--
|
|
|
874,000
|
|
|
874,000
|
|
|
General and administrative
|
|
3,329,000
|
|
|
--
|
|
|
3,329,000
|
|
|
3,457,000
|
|
|
--
|
|
|
3,457,000
|
|
|
Depreciation and amortization
|
|
931,000
|
|
|
3,849,000
|
|
|
4,780,000
|
|
|
616,000
|
|
|
3,049,000
|
|
|
3,665,000
|
|
|
Rental operating expenses
|
|
1,195,000
|
|
|
6,063,000
|
|
|
7,258,000
|
|
|
897,000
|
|
|
3,671,000
|
|
|
4,568,000
|
|
| Total operating expenses |
|
15,569,000
|
|
|
12,434,000
|
|
|
28,003,000
|
|
|
17,647,000
|
|
|
7,594,000
|
|
|
25,241,000
|
|
|
Equity in joint venture (loss) income
|
|
(646,000
|
)
|
|
646,000
|
|
|
--
|
|
|
5,191,000
|
|
|
(5,191,000
|
)
|
|
--
|
|
|
Interest income from loan pool
participations and notes receivable
|
|
1,048,000
|
|
|
(1,048,000
|
)
|
|
--
|
|
|
4,209,000
|
|
|
(4,209,000
|
)
|
|
--
|
|
| Operating (loss) income |
|
(2,391,000
|
)
|
|
5,307,000
|
|
|
2,916,000
|
|
|
3,526,000
|
|
|
4,316,000
|
|
|
7,842,000
|
|
| Non-operating income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
635,000
|
|
|
(635,000
|
)
|
|
--
|
|
|
144,000
|
|
|
(144,000
|
)
|
|
--
|
|
|
Remeasurement gain
|
|
--
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
Gain on extinguishment of debt
|
|
--
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
Loss on extinguishment of debt
|
|
--
|
|
|
|
|
--
|
|
|
(4,788,000
|
)
|
|
|
|
(4,788,000
|
)
|
|
Interest expense
|
|
(6,117,000
|
)
|
|
(4,672,000
|
)
|
|
(10,789,000
|
)
|
|
(2,198,000
|
)
|
|
(4,172,000
|
)
|
|
(6,370,000
|
)
|
| Loss before provision for income taxes
|
|
(7,873,000
|
)
|
|
--
|
|
|
(7,873,000
|
)
|
|
(3,316,000
|
)
|
|
--
|
|
|
(3,316,000
|
)
|
|
Benefit from (provision for) income taxes
|
|
2,997,000
|
|
|
--
|
|
|
2,997,000
|
|
|
(383,000
|
)
|
|
--
|
|
|
(383,000
|
)
|
| Net loss |
|
$
|
(4,876,000
|
)
|
|
$
|
--
|
|
|
$
|
(4,876,000
|
)
|
|
$
|
(3,699,000
|
)
|
|
$
|
--
|
|
|
$
|
(3,699,000
|
)
|
|
| Kennedy-Wilson Holdings, Inc. and Subsidiaries |
| Proforma Statements of (Loss) Income |
| (Unaudited) |
|
|
|
|
|
Nine Months Ended September 30, |
|
|
2011 |
|
2010 |
|
|
Consolidated |
|
Pro Rata Unconsolidated Investments |
|
Proforma Total |
|
Consolidated |
|
Pro Rata Unconsolidated Investments |
|
Proforma Total |
| Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
Management and leasing fees
|
|
$
|
17,808,000
|
|
|
$
|
--
|
|
|
$
|
17,808,000
|
|
|
$
|
16,102,000
|
|
|
$
|
--
|
|
|
$
|
16,102,000
|
|
|
Commissions
|
|
8,429,000
|
|
|
--
|
|
|
8,429,000
|
|
|
8,672,000
|
|
|
--
|
|
|
8,672,000
|
|
|
Sale of real estate
|
|
417,000
|
|
|
34,164,000
|
|
|
34,581,000
|
|
|
3,937,000
|
|
|
1,422,000
|
|
|
5,359,000
|
|
|
Rental and other income
|
|
3,359,000
|
|
|
46,077,000
|
|
|
49,436,000
|
|
|
2,934,000
|
|
|
27,590,000
|
|
|
30,524,000
|
|
|
Interest income
|
|
--
|
|
|
8,838,000
|
|
|
8,838,000
|
|
|
--
|
|
|
11,019,000
|
|
|
11,019,000
|
|
| Total revenue |
|
30,013,000
|
|
|
89,079,000
|
|
|
119,092,000
|
|
|
31,645,000
|
|
|
40,031,000
|
|
|
71,676,000
|
|
| Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commission and marketing expenses
|
|
3,015,000
|
|
|
--
|
|
|
3,015,000
|
|
|
2,032,000
|
|
|
--
|
|
|
2,032,000
|
|
|
Compensation and related expenses
|
|
24,562,000
|
|
|
--
|
|
|
24,562,000
|
|
|
29,400,000
|
|
|
--
|
|
|
29,400,000
|
|
|
Cost of real estate sold
|
|
397,000
|
|
|
29,674,000
|
|
|
30,071,000
|
|
|
2,714,000
|
|
|
1,049,000
|
|
|
3,763,000
|
|
|
General and administrative
|
|
9,183,000
|
|
|
--
|
|
|
9,183,000
|
|
|
8,263,000
|
|
|
--
|
|
|
8,263,000
|
|
|
Depreciation and amortization
|
|
1,828,000
|
|
|
11,558,000
|
|
|
13,386,000
|
|
|
1,197,000
|
|
|
7,203,000
|
|
|
8,400,000
|
|
|
Rental operating expenses
|
|
2,248,000
|
|
|
18,568,000
|
|
|
20,816,000
|
|
|
1,421,000
|
|
|
9,641,000
|
|
|
11,062,000
|
|
| Total operating expenses |
|
41,233,000
|
|
|
59,800,000
|
|
|
101,033,000
|
|
|
45,027,000
|
|
|
17,893,000
|
|
|
62,920,000
|
|
|
Equity in joint venture income (loss)
|
|
7,229,000
|
|
|
(7,229,000
|
)
|
|
--
|
|
|
5,162,000
|
|
|
(5,162,000
|
)
|
|
--
|
|
|
Interest income from loan pool
participations and notes receivable
|
|
5,835,000
|
|
|
(5,835,000
|
)
|
|
--
|
|
|
7,950,000
|
|
|
(7,950,000
|
)
|
|
--
|
|
| Operating income (loss) |
|
1,844,000
|
|
|
16,215,000
|
|
|
18,059,000
|
|
|
(270,000
|
)
|
|
9,026,000
|
|
|
8,756,000
|
|
| Non-operating income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
1,234,000
|
|
|
(1,234,000
|
)
|
|
--
|
|
|
645,000
|
|
|
(645,000
|
)
|
|
--
|
|
|
Remeasurement gain
|
|
6,348,000
|
|
|
--
|
|
|
6,348,000
|
|
|
2,108,000
|
|
|
--
|
|
|
2,108,000
|
|
|
Gain on extinguishment of debt
|
|
--
|
|
|
--
|
|
|
--
|
|
|
16,670,000
|
|
|
--
|
|
|
16,670,000
|
|
|
Loss on extinguishment of debt
|
|
--
|
|
|
|
|
--
|
|
|
(4,788,000
|
)
|
|
--
|
|
|
(4,788,000
|
)
|
|
Interest expense
|
|
(13,874,000
|
)
|
|
(14,981,000
|
)
|
|
(28,855,000
|
)
|
|
(6,492,000
|
)
|
|
(8,381,000
|
)
|
|
(14,873,000
|
)
|
| (Loss) income before provision for income taxes
|
|
(4,448,000
|
)
|
|
--
|
|
|
(4,448,000
|
)
|
|
7,873,000
|
|
|
--
|
|
|
7,873,000
|
|
|
Benefit from (provision for) income taxes
|
|
2,162,000
|
|
|
--
|
|
|
2,162,000
|
|
|
(4,335,000
|
)
|
|
--
|
|
|
(4,335,000
|
)
|
| Net (loss) income |
|
$
|
(2,286,000
|
)
|
|
$
|
--
|
|
|
$
|
(2,286,000
|
)
|
|
$
|
3,538,000
|
|
|
$
|
--
|
|
|
$
|
3,538,000
|
|
|
| Kennedy-Wilson Holdings, Inc. and Subsidiaries |
| Adjusted Net (Loss) Income Attributable to Kennedy Wilson Common
Shareholders |
| (Unaudited) |
|
|
|
|
|
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
Net loss attributable to Kennedy-Wilson Holdings, Inc. common
shareholders
|
|
$
|
(6,870,000
|
)
|
|
$
|
(6,718,000
|
)
|
|
$
|
(10,289,000
|
)
|
|
$
|
(1,360,000
|
)
|
| Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
Add back:
|
|
|
|
|
|
|
|
|
|
Stock based compensation
|
|
1,296,000
|
|
|
2,055,000
|
|
|
3,761,000
|
|
|
5,976,000
|
|
|
Common stock issuance discount treated as preferred dividend
|
|
--
|
|
|
-- |
|
|
600,000
|
|
|
--
|
|
|
Merger-related compensation expense
|
|
-- |
|
|
-- |
|
|
--
|
|
|
2,225,000
|
|
| Adjusted Net (Loss) Income Attributable to Kennedy Wilson Common Shareholders
|
|
$
|
(5,574,000
|
)
|
|
$
|
(4,663,000
|
)
|
|
$
|
(5,928,000
|
)
|
|
$
|
6,841,000
|
|
| Basic weighted average number of common shares outstanding
|
|
44,016,880
|
|
|
38,961,822
|
|
|
40,712,496
|
|
|
39,062,570
|
|
| Basic Adjusted Net (Loss) Income Attributable to Kennedy Wilson Common Shareholders Per Share
|
|
$
|
(0.13
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
0.18
|
|
|
| Kennedy-Wilson Holdings, Inc. and Subsidiaries |
| EBITDA and Adjusted EBITDA |
| (Unaudited) |
|
|
|
|
|
|
|
Three months ended September 30, |
|
Nine months ended September 30, |
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
Net (loss) income
|
|
$
|
(4,876,000
|
)
|
|
$
|
(3,699,000
|
)
|
|
$
|
(2,286,000
|
)
|
|
$
|
3,538,000
|
|
Add back:
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
6,117,000
|
|
|
2,198,000
|
|
|
13,874,000
|
|
|
6,492,000
|
|
Kennedy-Wilson's share of interest expense included in investment
in joint ventures and loan pool participations
|
|
4,672,000
|
|
|
4,172,000
|
|
|
14,981,000
|
|
|
8,381,000
|
|
Depreciation and amortization
|
|
931,000
|
|
|
616,000
|
|
|
1,828,000
|
|
|
1,197,000
|
|
Kennedy-Wilson's share of depreciation and amortization included
in investment in joint ventures
|
|
3,849,000
|
|
|
3,049,000
|
|
|
11,558,000
|
|
|
7,203,000
|
|
Loss on early extinguishment of corporate debt
|
|
--
|
|
|
4,788,000
|
|
|
--
|
|
|
4,788,000
|
|
Income taxes
|
|
(2,997,000
|
)
|
|
383,000
|
|
|
(2,162,000
|
)
|
|
4,335,000
|
| EBITDA |
|
7,696,000 |
|
|
11,507,000 |
|
|
37,793,000 |
|
|
35,934,000 |
|
Merger-related compensation expense
|
|
--
|
|
|
--
|
|
|
--
|
|
|
2,225,000
|
|
Stock-based compensation
|
|
1,296,000
|
|
|
2,055,000
|
|
|
3,761,000
|
|
|
5,976,000
|
| Adjusted EBITDA |
|
$ |
8,992,000 |
|
|
$ |
13,562,000 |
|
|
$ |
41,554,000 |
|
|
$ |
44,135,000 |
SOURCE: Kennedy-Wilson Holdings, Inc.
Kennedy Wilson
Christina Cha
Director of Corporate Communication
(310) 887-6294
[email protected]
www.kennedywilson.com |