Rouse Co. of Columbia said yesterday that it lost $5.3 million in the fourth quarter of 2002 but that its profit for the year rose 26.3 percent as revenue from its community developments and shopping malls increased.
The real estate development company said it lost 10 cents per share on revenue of $350 million in the quarter ended Dec. 31 because of one-time restructuring and impairment charges. Rouse reported net income of $24.3 million (30 cents) on revenue of $264.1 million in the same quarter a year earlier.
Rouse said charges of $13.2 million that it incurred in the quarter were tied to its recent reorganization, which was announced last October. The company also reported $39.6 million in write-down costs from two troubled shopping centers it owns in New Jersey and Florida, as well as a small gain on the sale of the vacant Tampa Bay Center mall in Florida.
For the year, the company earned $139.9 million ($1.47) on revenue of $1.22 billion, up from $110.7 million ($1.40) on revenue of $1.06 billion in 2001.
Rouse's funds from operations from recurring activities totaled a record $115.8 million in the quarter, up from $73.3 million for the same period of 2001. Funds from operations is a standard performance measure for real estate companies that excludes items such as depreciation and amortization expenses, as well as gains or losses on real estate sales. For the year, funds from operations grew to $357.3 million from $283.8 million.
Rouse chief executive Anthony W. Deering said yesterday that for 2003, the company expects funds from operations of $4.15 to $4.25 per share, up 8 to 10 percent.
Deering said the company's retail portfolio was bolstered last year by the $1.5 billion purchase of part of the assets of mall firm Rodamco North America NV. Deering said the company expects no dramatic turnaround in occupancy levels at its office properties, where net operating income fell 2.3 percent for the year. Its retail and community development businesses should remain strong, he said. Legg Mason Wood Walker Inc. analyst David M. Fick said Rouse outperformed his expectations and profited from growth in its retail sector.
"All mall companies are doing well this year in terms of their earnings performance," Fick said. "Rouse is benefiting from a very robust environment in the regional mall business."
Rouse shares closed yesterday at $32.20, up 38 cents, on the New York Stock Exchange.