ASSOCIATED ESTATES REALTY CORP

CIK:0000911635|SEC Filings

Consolidated Statement of Operations and Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenue
Property revenue	$ 48,314	$ 47,268	$ 95,631	$ 96,417
Commercial revenue	580	455	1,192	933
Property management and construction services revenue	307	179	621	267
Total revenue	49,201	47,902	97,444	97,617
Expenses
Property operating and maintenance	19,162	18,132	38,073	37,500
Depreciation and amortization	16,741	15,885	32,676	32,180
General and administrative	6,972	4,596	13,491	9,915
Development costs	133	198	332	528
Construction services	248	33	451	90
Costs associated with acquisitions	11	27	73	113
Total expenses	43,267	38,871	85,096	80,326
Operating income	5,934	9,031	12,348	17,291
Interest expense	(6,417)	(6,587)	(12,530)	(13,540)
Gain on change in control	0	0	444	0
Gain on disposition of properties	30,022	59,904	30,022	100,870
Net income	29,539	62,348	30,284	104,621
Allocation to participating securities	(73)	(212)	(75)	(355)
Net income applicable to common shares	$ 29,466	$ 62,136	$ 30,209	$ 104,266
Earnings per common share - basic:
Net income applicable to common shares - basic	$ 0.51	$ 1.08	$ 0.52	$ 1.82
Earnings per common share - diluted:
Net income applicable to common shares - diluted	$ 0.51	$ 1.07	$ 0.52	$ 1.80
Comprehensive income:
Net income	$ 29,539	$ 62,348	$ 30,284	$ 104,621
Change in fair value and reclassification of hedge instruments	1,011	(683)	875	(746)
Total comprehensive income	$ 30,550	$ 61,665	$ 31,159	$ 103,875
Dividends declared per common share	$ 0.00	$ 0.19	$ 0.21	$ 0.38
Weighted average number of common shares outstanding - basic	57,744	57,475	57,678	57,419
Weighted average number of common shares outstanding - diluted	58,346	57,919	58,285	57,876

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flow from operating activities:
Net income	$ 30,284	$ 104,621
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	(32,676)	(32,180)
Gain on change in control	(444)	0
Gain on disposition of properties	(30,022)	(100,870)
Amortization of deferred financing costs and other	597	549
Share-based compensation expense	2,032	2,170
Net change in assets and liabilities:
Accounts receivable	30	16
Accounts payable and accrued expenses	(61)	(4,180)
Other operating assets and liabilities	786	667
Total adjustments	5,594	(69,468)
Net cash flow provided by operating activities	35,878	35,153
Cash flow from investing activities:
Recurring fixed asset additions	(5,263)	(4,203)
Revenue enhancing/non-recurring fixed asset additions	(3,335)	(696)
Acquisition fixed asset additions	(82,330)	(46,385)
Development fixed asset additions	(28,972)	(27,609)
Acquisition of unconsolidated entity	(8,316)	0
Net proceeds from disposition of operating properties	47,994	168,756
Contributions to joint venture	(13,384)	(5,636)
Deposits on potential future acquisitions	(1,903)	3,193
Cash proceeds from sale of equity interest in development property	0	24,075
Escrow deposits related to property sales	(32,100)	(72,292)
Escrow Deposit Disbursements Related to Property Acquisition	43,295	52,414
Costs paid on behalf of joint venture	0	(5,639)
Reimbursements of costs paid on behalf of joint venture	0	4,420
Other investing activity	(397)	(589)
Net cash flow (used for) provided by investing activities	(84,711)	89,809
Cash flow from financing activities:
Principal amortization payments on mortgage notes payable	(1,137)	(1,041)
Principal repayments of mortgage notes payable	0	(20,038)
Payment of debt procurement costs	(42)	(130)
Proceeds from secured construction loans	17,257	20,782
Revolving credit facility borrowings	157,000	117,000
Revolving credit facility repayments	(97,500)	(214,500)
Common share dividends paid	(24,037)	(22,579)
Exercise of stock options	1,198	714
Purchase of treasury shares	(1,187)	(999)
Other financing activities, net	0	127
Net cash flow provided by (used for) financing activities	51,552	(120,664)
Increase in cash and cash equivalents	2,719	4,298
Cash and cash equivalents, beginning of period	4,692	4,586
Cash and cash equivalents, end of period	7,411
Supplemental disclosure of non-cash transactions:
Dividends declared but not paid	1,027	11,495
Net change in accounts payable related to fixed asset additions	(5,768)	5,028
Increase in consolidated net assets due to change in control	8,400	0
Deconsolidation of net assets	$ 0	$ 26,238

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Real estate assets
Land	$ 279,570	$ 261,777
Buildings and improvements	1,435,902	1,346,870
Furniture and fixtures	42,367	41,609
Construction in progress	47,886	73,581
Gross real estate	1,805,725	1,723,837
Less: Accumulated depreciation	(398,659)	(397,210)
Net real estate owned	1,407,066	1,326,627
Investment in unconsolidated entities	59,396	54,800
Total net real estate	1,466,462	1,381,427
Cash and cash equivalents	7,411	4,692
Restricted cash	36,186	46,361
Accounts receivable, net
Rents	1,142	1,093
Other	3,855	2,977
Other assets, net	30,805	29,147
Total assets	1,545,861	1,465,697
LIABILITIES AND EQUITY
Mortgage notes payable	288,355	272,613
Unsecured notes	250,000	250,000
Unsecured revolving credit facility	136,000	76,500
Unsecured term loan	150,000	150,000
Total debt	824,355	749,113
Accounts payable and other liabilities	41,745	47,070
Dividends payable	1,027	12,886
Resident security deposits	3,921	3,860
Accrued interest	5,254	5,192
Total liabilities	876,302	818,121
Equity
Common shares, without par value; $.10 stated value; 91,000,000 authorized; 58,021,078 issued and 58,020,888 outstanding at June 30, 2015 and 57,708,675 issued and 57,649,609 outstanding at December 31, 2014, respectively	5,802	5,771
Paid-in capital	760,274	758,079
Accumulated distributions in excess of accumulated net income	(96,644)	(114,551)
Accumulated other comprehensive loss	(218)	(1,093)
Less: Treasury shares, at cost, 190 and 56,066 shares at June 30, 2015 and December 31, 2014, respectively	(5)	(980)
Total shareholders' equity attributable to AERC	669,209	647,226
Noncontrolling interest	350	350
Total equity	669,559	647,576
Total liabilities and equity	$ 1,545,861	$ 1,465,697