UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of
1934
Date
of Report (Date of earliest event reported): November 9,
2007
Stratus
Properties Inc.
(Exact
name of registrant as specified in its charter)
|
Delaware
|
0-19989
|
72-1211572
|
||
|
(State
or other jurisdiction of incorporation)
|
(Commission
File Number)
|
(IRS
Employer Identification Number)
|
|
98
San Jacinto Blvd., Suite 220
|
|
|
Austin,
Texas
|
78701
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Registrant's
telephone number, including area code: (512) 478-5788
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[
]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[
]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[
]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act
(17 CFR 240.14d-2(b))
[
]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act
(17 CFR 240.13e-4(c))
Item
2.02. Results of Operations and Financial
Condition.
Stratus
Properties Inc. issued a press release dated November 9, 2007, announcing its
third-quarter and nine-month 2007 results and updating its development
activities (see exhibit 99.1).
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibit.
The
Exhibit included as part of this Current Report is listed in the attached
Exhibit Index.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Stratus
Properties Inc.
By:
/s/
John E. Baker
----------------------------------------
John
E.
Baker
Senior
Vice President and
Chief
Financial Officer
(authorized
signatory and
Principal
Financial Officer)
Date: November
9, 2007
Stratus
Properties Inc.
Exhibit
Index
Exhibit
Number
|
Press
release dated November 9, 2007, titled “Stratus Properties Inc. Reports
Third-Quarter and Nine-Month 2007 Results and Updates Development
Activities.”
|
||
|
NEWS
RELEASE
|
|
|
NASDAQ
Symbol: “STRS”
|
|
|
Stratus
Properties Inc.
|
Financial
and Media Contact:
|
|
98
San Jacinto Blvd. Suite 220
|
William
H. Armstrong III
|
|
Austin,
Texas 78701
|
(512)
478-5788
|
STRATUS
PROPERTIES INC. REPORTS
THIRD-QUARTER
AND NINE-MONTH 2007 RESULTS
AND
UPDATES DEVELOPMENT ACTIVITIES
HIGHLIGHTS
|
·
|
On
October 12, 2007, Stratus sold the Escarpment Village shopping center
for
$46.5 million, before closing costs and other adjustments. Stratus
expects
to recognize a pre-tax gain of approximately $16.5 million on the
sale in
the fourth quarter of 2007.
|
|
·
|
The
Block 21 onsite sales center opened in October 2007 in conjunction
with
the groundbreaking ceremony for the downtown mixed-use
project.
|
|
·
|
For
the fourth quarter of 2007, Stratus’ scheduled real estate sales under
existing homebuilder lot sale contracts include the
following:
|
|
o
|
46
lots in its Circle C community for $3.0
million
|
|
o
|
15
lots at its Deerfield project for $1.0
million
|
|
o
|
3
lots at its Wimberly Lane Phase II subdivision in the Barton Creek
community for $0.5 million
|
|
Third
Quarter
|
Nine
Months
|
|||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||
|
(In
Thousands, Except Per Share Amounts)
|
||||||||||||
|
Revenues
|
$
|
8,036
|
$
|
9,069
|
$
|
20,140
|
$
|
53,099
|
||||
|
Operating
(loss) income
|
(423
|
)
|
1,231
|
864
|
21,320
|
|||||||
|
(Loss)
income from continuing operations
|
(313
|
)
|
1,342
|
866
|
29,661
|
|||||||
|
(Loss)
income from discontinued operations, including
|
||||||||||||
|
net
gain on sale of 7000 West of $7.3 million
|
||||||||||||
|
in
the 2006 nine-month period
|
(32
|
)
|
(161
|
)
|
(232
|
)
|
7,470
|
|||||
|
Net
(loss) income
|
$
|
(345
|
)
|
$
|
1,181
|
$
|
634
|
$
|
37,131
|
|||
|
Diluted
net (loss) income per share of common stock:
|
||||||||||||
|
Continuing
operations
|
$
|
(0.04
|
)
|
$
|
0.18
|
$
|
0.11
|
$
|
3.87
|
|||
|
Discontinued
operations
|
(0.01
|
)
|
(0.02
|
)
|
(0.03
|
)
|
0.98
|
|||||
|
Diluted
net (loss) income per share of common stock
|
$
|
(0.05
|
)
|
$
|
0.16
|
$
|
0.08
|
$
|
4.85
|
|||
|
Diluted
weighted average shares of common stock
|
||||||||||||
|
outstanding
|
7,560
|
7,617
|
7,640
|
7,658
|
||||||||
AUSTIN,
TX, November 9, 2007 – Stratus Properties Inc. (NASDAQ: STRS) reported a net
loss of $0.3 million, $0.05 per share, for the third quarter of 2007, compared
to net income of $1.2 million, $0.16 per share, for the third quarter of 2006.
For the nine months ended September 30, 2007, Stratus reported net income of
$0.6 million, $0.08 per share, compared with $37.1 million, $4.85 per share,
for
the nine months ended September 30, 2006. Income from continuing operations
for
the first nine months of 2006 included an $8.3 million, $1.08 per share, tax
benefit resulting from the reversal of a portion of Stratus’ deferred tax asset
valuation allowance.
On
October 12, 2007, Stratus sold the Escarpment Village shopping center, located
in Austin, Texas, to Lake Villa, L.L.C. (the Purchaser) for $46.5 million,
before closing costs and other adjustments. Accordingly, the 2007 and 2006
periods present results of operations for Escarpment Village in income (loss)
from discontinued operations in Stratus’ condensed consolidated statements of
operations. Losses from discontinued operations for Escarpment Village totaled
less than $0.1 million in the third quarter of 2007, $0.1 million in the third
quarter of 2006, $0.2 million in the first nine months of 2007 and $0.1 million
in the first nine months of 2006. The Purchaser paid approximately $23.0 million
in cash at closing and assumed the $22.4 million principal balance remaining
under Stratus’ loan from Teachers Insurance and Annuity Association of America.
Stratus intends to use the net proceeds from the sale for debt reduction and
general corporate purposes. Stratus expects to record a pre-tax gain
of approximately $16.5 million on the sale in the fourth quarter of
2007.
In
the
second quarter of 2007, Stratus committed to a plan to sell its two office
buildings at 7500 Rialto Boulevard (7500 Rialto), and as a result, classified
all related operating results and assets and liabilities as discontinued
operations. However, in the third quarter of 2007, Stratus decided to cease
its
marketing efforts to sell 7500 Rialto in light of recent changes in credit
market conditions. Accordingly, the 2007 and 2006 periods present results of
operations and assets and liabilities of 7500 Rialto as part of Stratus’
continuing operations.
On
March
27, 2006, Stratus sold 7000 West for $22.3 million, resulting in a net after-tax
gain of $7.3 million, $0.95 per share, in the first nine months of 2006. Other
than the gain from the sale of 7000 West, income from discontinued operations
for 7000 West was $0.4 million, $0.05 per share, in the first nine months of
2006. The third-quarter 2006 loss from discontinued operations for 7000 West
includes a provision for income taxes of $0.1 million for the allocation of
Stratus’ third-quarter 2006 tax provision to discontinued operations in
accordance with income tax accounting rules.
Real
Estate Revenues. Property sales for the third-quarter and
nine-month periods of 2007 and 2006 included the
following (revenues in thousands):
|
Third
Quarter
|
||||||||
|
2007
|
2006
|
|||||||
|
Lots
|
Revenues
|
Lots
|
Revenues
|
|||||
|
Residential
Properties:
|
||||||||
|
Barton
Creek
|
||||||||
|
Calera
Drive
|
-
|
$ -
|
5
|
$2,065
|
||||
|
Calera
Court Courtyard Homes
|
1
|
657
|
1
|
610
|
||||
|
Mirador
Estate
|
-
|
-
|
1
|
553
|
||||
|
Wimberly
Lane Phase II
|
||||||||
|
Standard
Homebuilder
|
3
|
516
|
4
|
686
|
||||
|
Amarra
Drive Phase I
|
1
|
1,250
|
-
|
-
|
||||
|
Circle
C
|
||||||||
|
Meridian
|
58
|
3,575
|
51
|
3,013
|
||||
|
Deerfield
|
15
|
1,004
|
15
|
1,007
|
||||
|
Total
Residential
|
78
|
$7,002
|
77
|
$7,934
|
||||
|
Nine
Months
|
||||||||
|
2007
|
2006
|
|||||||
|
Lots
|
Revenues
|
Lots
|
Revenues
|
|||||
|
Residential
Properties:
|
||||||||
|
Barton
Creek
|
||||||||
|
Calera
Drive
|
2
|
$809
|
23
|
$9,919
|
||||
|
Calera
Court Courtyard Homes
|
1
|
657
|
5
|
2,922
|
||||
|
Mirador
Estate
|
2
|
1,559
|
6
|
3,306
|
||||
|
Wimberly
Lane Phase II
|
||||||||
|
Standard
Homebuilder
|
9
|
1,561
|
9
|
1,469
|
||||
|
Amarra
Drive Phase I
|
1
|
1,250
|
-
|
-
|
||||
|
Circle
C
|
||||||||
|
Meridian
|
106
|
6,814
|
133
|
7,804
|
||||
|
Deerfield
|
45
|
3,012
|
45
|
3,021
|
||||
|
Total
Residential
|
166
|
$15,662
|
221
|
$28,441
|
||||
Stratus
sold a five-acre tract at the Circle C community for $1.1 million during the
first quarter of 2007 and a 7.5-acre tract in the Barton Creek community for
$1.5 million during the first quarter of 2006. In April 2006, Stratus sold
a
58-acre tract at Lantana for $21.2 million of which $0.5 million represented
a
reimbursement of certain costs, which was recorded as a reduction of cost of
sales.
Rental
Income. Rental income for 7500 Rialto increased to $0.7 million
in the third quarter of 2007 reflecting the opening of the second office
building in September 2006, compared with $0.4 million in the third quarter
of
2006. As of September 30, 2007, the first office building at 7500 Rialto was
fully leased and the second office building was approximately 94 percent
leased.
Development
Activities.Block 21– In April 2005, the City of Austin selected
Stratus’ proposal to develop a mixed-use project in downtown Austin immediately
north of the new City Hall complex. The project includes an entire city block
and is planned for a mixture of retail, hotel, residential and entertainment
uses. In December 2006, Stratus acquired the property for $15.1 million. Stratus
has executed agreements with Starwood Hotels
&
Resorts Worldwide, Inc. for the development of a W Hotel and Residences on
the
site. On May 8, 2007, Stratus announced its partnership with Canyon-Johnson
Urban Fund II, L.P., a joint venture between the Los Angeles-based Canyon
Capital Realty Advisors and Earvin "Magic" Johnson, for the development of
Block
21. Stratus has begun the permitting process with the City of Austin and the
grand opening for the onsite sales center was held in conjunction with the
groundbreaking ceremony in October 2007.
Lantana–
Lantana is a partially developed, mixed-use project with remaining entitlements
for approximately 1.0 million square feet of office and retail use on 223 acres
as of September 30, 2007. Regional utility and road infrastructure is in place
with capacity to serve Lantana at full build-out permitted under Stratus’
existing entitlements.
Calera–
During 2004, Stratus began construction of courtyard homes at Calera Court
within the Barton Creek community. Calera Court, the initial phase of the
“Calera” subdivision, will include 16 homesites on 16 acres. The second phase of
Calera, Calera Drive, consisting of 53 single-family lots, many of which adjoin
the Fazio Canyons golf course, received final plat and construction permit
approval in 2005. As of September 30, 2007, only eight lots remained unsold
at
Calera Drive. Development of the final phase, known as Verano Drive, will
include 71 single-family lots. Construction of the final phase of Calera began
in the first quarter of 2007 and is scheduled for completion in December
2007.
Wimberly
Lane Phase II– In 2004, Stratus entered into a contract with a national
homebuilder to sell 41 lots within the Wimberly Lane Phase II subdivision in
the
Barton Creek community. The homebuilder paid Stratus a non-refundable $0.6
million deposit for the right to purchase the 41 lots. The deposit was used
to
pay ongoing development costs of the lots. The deposit will be applied against
subsequent purchases of lots by the homebuilder after certain thresholds are
achieved and will be recognized by Stratus as income as lots are sold. The
lots
are being sold on a scheduled takedown basis, with the initial six lots sold
in
December 2004 following completion of subdivision utilities, and then an average
of three lots per quarter beginning in June 2005. The average purchase price
for
each of the 41 lots is $150,400, subject to a six percent annual escalator
commencing in December 2004.
Circle
C Community– Stratus is developing the Circle C community based on the
entitlements secured in its Circle C settlement with the City of Austin. The
Circle C settlement, as amended in 2004, permits development of 1.16 million
square feet of commercial space, 504 multi-family units and 830 single family
residential lots. Meridian is an 800-lot residential development at the Circle
C
community. In January 2005, the first phase of construction commenced. During
the first quarter of 2005, Stratus contracted to sell a total of 494 lots in
its
Meridian project to three national homebuilders in four phases. Sales for each
of the four phases commence upon substantial completion of development for
that
phase, and continue every quarter until all of the lots have been sold. The
first and second phases each consisted of 134 lots. The first phase was
substantially completed at the end of 2005. Development of the second phase
was
substantially completed in March 2006. Development of the 108-lot third phase
of
Meridian was completed in September 2007. The 118-lot fourth phase will commence
in 2008 and completion is expected by the end of 2008.
In
2006,
Stratus signed another contract with a national homebuilder for 42 additional
lots. Development of those lots commenced in April 2007 and substantial
completion is expected in November 2007. Development of the final phase of
Meridian, which consists of 57 one-acre lots, is expected to commence in
2008.
Stratus
estimates its sales from the first three phases of Meridian will total at least
46 lots for $3.0 million during the fourth quarter of 2007.
Deerfield–
In January 2004, Stratus acquired the Deerfield property in Plano, Texas, for
$7.0 million. The property was zoned and subject to a preliminary subdivision
plan for 234 residential lots. Stratus executed agreements with a national
homebuilder, whereby the homebuilder paid Stratus $1.4 million for an option
to
purchase all 234 lots over 36 monthly take-downs. The net purchase price for
each of the 234 lots was $61,500, subject to certain terms and conditions.
The
$1.4 million option payment is non-refundable, but will be applied against
subsequent purchases of lots by the homebuilder after certain thresholds are
achieved and will be recognized by Stratus as income as lots are sold. Stratus
agreed to pay up to $5.2 million of the homebuilder’s development costs. The
homebuilder must pay all property taxes and maintenance costs. The initial
lot
sale occurred in November 2004 and subsequent lot sales are on schedule. In
October 2005, Stratus executed a revised agreement with the homebuilder,
increasing the lot sizes and average purchase price to $67,150 based on a new
total of 224 lots. Stratus expects 15 lot sales for $1.0 million to be completed
during the fourth quarter of 2007.
Crestview
Station– In November 2005, Stratus formed a joint venture with Trammell
Crow Central Texas Development, Inc. to acquire an approximate 74-acre tract
at
the intersection of Airport Boulevard and Lamar Boulevard in Austin, Texas,
for
$7.7 million. With its joint venture partner, Stratus has commenced brown-field
remediation and permitting of the property, known as Crestview Station, which
is
located on the commuter rail line recently approved by City of Austin voters.
Crestview station is planned for single-family, multi-family and retail
development, with closings on the retail and multi-family components expected
to
occur in 2007.
The
joint
venture partnership has contracted with a nationally recognized remediation
firm
to demolish the existing buildings and remediate the property in preparation
for
permitting. Under the terms of the remediation contract, the joint venture
partnership will pay the contractor approximately $4.9 million upon completion
of performance benchmarks and certification by the State of Texas that the
remediation is complete. The contractor is required to pay all costs associated
with the remediation and to maintain an environmental liability policy with
$10.0 million of coverage remaining in place for a 10-year term. Pursuant to
the
agreement with the contractor, all environmental and legal liability was
assigned to and assumed by the contractor effective November 30, 2005. In
September 2007, the State of Texas certified that the remediation was
complete.
Stratus
is a diversified real estate company engaged in the acquisition, development,
management and sale of commercial, multi-family and residential real estate
properties located primarily in the Austin, Texas area.
____________________________
CAUTIONARY
STATEMENT. This press release contains certain forward-looking
statements regarding proposed real estate sales and development activities
at
Block 21, the Lantana community, the Barton Creek community, the Circle C
community, Deerfield and Crestview Station. Important factors that might cause
future results to differ from those projections include economic and business
conditions, the availability of financing, regulatory approvals and
environmental regulations, which are described in more detail in Stratus’ 2006
Annual Report on Form 10-K filed with the Securities and Exchange
Commission.
A
copy of
this release is available on our web site,
www.stratusproperties.com.
# # #
STRATUS
PROPERTIES INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In
Thousands, Except Per Share Amounts)
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||
|
September
30,
|
September
30,
|
|||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||
|
Revenues:
|
||||||||||||
|
Real
estate
|
$
|
7,002
|
$
|
7,934
|
$
|
16,745
|
$
|
50,686
|
||||
|
Rental
income
|
766
|
389
|
2,146
|
1,117
|
||||||||
|
Commissions,
management fees and other
|
268
|
746
|
1,249
|
1,296
|
||||||||
|
Total
revenues
|
8,036
|
9,069
|
20,140
|
53,099
|
||||||||
|
Cost
of sales:
|
||||||||||||
|
Real
estate, net
|
5,662
|
5,633
|
10,651
|
24,864
|
||||||||
|
Rental
|
860
|
483
|
2,391
|
1,198
|
||||||||
|
Depreciation
|
411
|
204
|
894
|
577
|
||||||||
|
Total
cost of sales
|
6,933
|
6,320
|
13,936
|
26,639
|
||||||||
|
General
and administrative expenses
|
1,526
|
1,518
|
5,340
|
5,140
|
||||||||
|
Total
costs and expenses
|
8,459
|
7,838
|
19,276
|
31,779
|
||||||||
|
Operating
(loss) income
|
(423
|
)
|
1,231
|
864
|
21,320
|
|||||||
|
Interest
expense, net
|
-
|
(3
|
)
|
(13
|
)
|
(267
|
)
|
|||||
|
Interest
income
|
36
|
102
|
572
|
304
|
||||||||
|
(Loss)
income from continuing operations
|
||||||||||||
|
before
income taxes
|
(387
|
)
|
1,330
|
1,423
|
21,357
|
|||||||
|
Benefit
from (provision for) income taxes
|
74
|
12
|
(557
|
)
|
8,304
|
a
|
||||||
|
(Loss)
income from continuing operations
|
(313
|
)
|
1,342
|
866
|
29,661
|
|||||||
|
(Loss)
income from discontinued operations
|
||||||||||||
|
(including
a gain on 7000 West sale of $7,264
|
||||||||||||
|
in
the 2006 nine-month period, net of taxes
|
||||||||||||
|
of
$84 in the third quarter of 2006 and
|
||||||||||||
|
$2,498
in the 2006 nine-month period)
|
(32
|
)b
|
(161
|
)b,
c
|
(232
|
)b
|
7,470
|
b,
c
|
||||
|
Net
(loss) income
|
$
|
(345
|
)
|
$
|
1,181
|
$
|
634
|
$
|
37,131
|
|||
|
Basic
net (loss) income per share of common stock:
|
||||||||||||
|
Continuing
operations
|
$
|
(0.04
|
)
|
$
|
0.18
|
$
|
0.11
|
$
|
4.07
|
|||
|
Discontinued
operations
|
(0.01
|
)
|
(0.02
|
)
|
(0.03
|
)
|
1.02
|
|||||
|
Basic
net (loss) income per share of common stock
|
$
|
(0.05
|
)
|
$
|
0.16
|
$
|
0.08
|
$
|
5.09
|
|||
|
Diluted
net (loss) income per share of common stock:
|
||||||||||||
|
Continuing
operations
|
$
|
(0.04
|
)
|
$
|
0.18
|
$
|
0.11
|
$
|
3.87
|
|||
|
Discontinued
operations
|
(0.01
|
)
|
(0.02
|
)
|
(0.03
|
)
|
0.98
|
|||||
|
Diluted
net (loss) income per share of common stock
|
$
|
(0.05
|
)
|
$
|
0.16
|
$
|
0.08
|
$
|
4.85
|
|||
|
Average
shares of common stock outstanding:
|
||||||||||||
|
Basic
|
7,560
|
7,317
|
7,559
|
7,288
|
||||||||
|
Diluted
|
7,560
|
7,617
|
7,640
|
7,658
|
||||||||
|
a.
|
Reflects
the tax benefit resulting from the reversal of a portion of Stratus’
deferred tax asset valuation
allowance.
|
|
b.
|
Includes
less than $(0.1) million in the third quarter of 2007, $(0.1) million
in
the third quarter of 2006, $(0.2) million in the first nine months
of 2007
and $(0.1) million in the first nine months of 2006 related to the
operations of Escarpment Village, which Stratus sold on October 12,
2007.
|
|
c.
|
Includes
$(0.1) million in the third quarter of 2006 and $7.6 million in the
first
nine months of 2006 related to the operations of 7000 West, which
Stratus
sold on March 27, 2006.
|
I
STRATUS
PROPERTIES INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
(In
Thousands)
|
September
30,
|
December
31,
|
|||||
|
2007
|
2006
|
|||||
|
ASSETS
|
||||||
|
Current
assets:
|
||||||
|
Cash
and cash equivalents
|
$
|
1,475
|
$
|
1,620
|
||
|
Restricted
cash
|
1,611
|
a
|
116
|
|||
|
Accounts
receivable
|
1,183
|
839
|
||||
|
Deposits,
prepaid expenses and other
|
430
|
82
|
||||
|
Deferred
tax asset
|
1,789
|
1,144
|
||||
|
Discontinued
operations
|
33,747
|
b
|
34,917
|
b
|
||
|
Total
current assets
|
40,235
|
38,718
|
||||
|
Real
estate, commercial leasing assets and facilities, net:
|
||||||
|
Property
held for sale – developed or under development
|
126,320
|
116,865
|
||||
|
Property
held for sale – undeveloped
|
16,444
|
16,345
|
||||
|
Property
held for use, net
|
24,673
|
18,874
|
||||
|
Investment
in Crestview
|
3,925
|
3,800
|
||||
|
Deferred
tax asset
|
6,728
|
7,105
|
||||
|
Other
assets
|
2,266
|
2,243
|
||||
|
Total
assets
|
$
|
220,591
|
$
|
203,950
|
||
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||
|
Current
liabilities:
|
||||||
|
Accounts
payable and accrued liabilities
|
$
|
8,417
|
$
|
5,676
|
||
|
Accrued
interest, property taxes and other
|
4,225
|
5,134
|
||||
|
Current
portion of long-term debt
|
2,000
|
-
|
||||
|
Discontinued
operations
|
24,689
|
b
|
24,678
|
b
|
||
|
Total
current liabilities
|
39,331
|
35,488
|
||||
|
Long-term
debt
|
40,000
|
28,000
|
||||
|
Other
liabilities
|
5,934
|
6,516
|
||||
|
Total
liabilities
|
85,265
|
70,004
|
||||
|
Stockholders’
equity:
|
||||||
|
Preferred
stock
|
-
|
-
|
||||
|
Common
stock
|
81
|
81
|
||||
|
Capital
in excess of par value of common stock
|
191,084
|
188,873
|
||||
|
Accumulated
deficit
|
(42,021
|
)
|
(42,655
|
)
|
||
|
Common
stock held in treasury
|
(13,818
|
)
|
(12,353
|
)
|
||
|
Total
stockholders’ equity
|
135,326
|
133,946
|
||||
|
Total
liabilities and stockholders' equity
|
$
|
220,591
|
$
|
203,950
|
||
|
a.
|
Includes
$1.5 million of proceeds from lot sales that is restricted for repayment
of outstanding amounts under Stratus’ revolving credit
facility.
|
|
b.
|
Represents
the assets and liabilities of Escarpment Village, which Stratus sold
on
October 12, 2007.
|
II
STRATUS
PROPERTIES INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In
Thousands)
|
Nine
Months Ended
|
||||||
|
September
30,
|
||||||
|
2007
|
2006
|
|||||
|
Cash
flow from operating activities:
|
||||||
|
Net
income
|
$
|
634
|
$
|
37,131
|
||
|
Adjustments
to reconcile net income to net cash provided by
|
||||||
|
operating
activities:
|
||||||
|
Loss
(income) from discontinued operations
|
232
|
(7,470
|
)
|
|||
|
Depreciation
|
894
|
577
|
||||
|
Cost
of real estate sold
|
10,163
|
20,112
|
||||
|
Deferred
income taxes
|
(267
|
)
|
(8,305
|
)
|
||
|
Stock-based
compensation
|
1,020
|
894
|
||||
|
Excess
tax benefit from exercised stock options
|
(642
|
)
|
-
|
|||
|
Deposits
|
(1,044
|
)
|
155
|
|||
|
(Increase)
decrease in restricted cash
|
(1,495
|
)
|
271
|
|||
|
Other
|
(335
|
)
|
(414
|
)
|
||
|
(Increase)
decrease in working capital:
|
||||||
|
Accounts
receivable and prepaid expenses
|
(16
|
)
|
(148
|
)
|
||
|
Accounts
payable, accrued liabilities and other
|
2,571
|
1,390
|
||||
|
Net
cash provided by continuing operations
|
11,715
|
44,193
|
||||
|
Net
cash provided by (used in) discontinued operations
|
1,586
|
a
|
(4,412
|
)a
|
||
|
Net
cash provided by operating activities
|
13,301
|
39,781
|
||||
|
Cash
flow from investing activities:
|
||||||
|
Purchases
and development of real estate properties
|
(27,007
|
)
|
(12,911
|
)
|
||
|
Development
of commercial leasing properties and other expenditures
|
(1,771
|
)
|
(8,848
|
)
|
||
|
Municipal
utility district reimbursements
|
2,557
|
1,337
|
||||
|
Investment
in Crestview
|
(125
|
)
|
-
|
|||
|
Net
cash used in continuing operations
|
(26,346
|
)
|
(20,422
|
)
|
||
|
Net
cash (used in) provided by discontinued operations
|
(113
|
)a
|
2,275
|
a
|
||
|
Net
cash used in investing activities
|
(26,459
|
)
|
(18,147
|
)
|
||
|
Cash
flow from financing activities:
|
||||||
|
Borrowings
from revolving credit facility
|
17,450
|
15,000
|
||||
|
Payments
on revolving credit facility
|
(18,450
|
)
|
(30,677
|
)
|
||
|
Borrowings
from unsecured term loans
|
15,000
|
-
|
||||
|
Borrowings
from project loans
|
-
|
1,214
|
||||
|
Repayments
on project loans
|
-
|
(15,904
|
)
|
|||
|
Net
proceeds from exercised stock options
|
13
|
917
|
||||
|
Excess
tax benefit from exercised stock options
|
642
|
-
|
||||
|
Purchases
of Stratus common shares
|
(1,118
|
)
|
(542
|
)
|
||
|
Bank
credit facility fees
|
-
|
(421
|
)
|
|||
|
Net
cash provided by (used in) continuing operations
|
13,537
|
(30,413
|
)
|
|||
|
Net
cash (used in) provided by discontinued operations
|
(232
|
)a
|
12,814
|
a
|
||
|
Net
cash provided by (used in) financing activities
|
13,305
|
(17,599
|
)
|
|||
|
Net
increase in cash and cash equivalents
|
147
|
4,035
|
||||
|
Cash
and cash equivalents at beginning of year
|
1,839
|
1,514
|
||||
|
Cash
and cash equivalents at end of period
|
1,986
|
5,549
|
||||
|
Less
cash at discontinued operations
|
(511
|
)
|
(548
|
)
|
||
|
Cash
and cash equivalents at end of period
|
$
|
1,475
|
$
|
5,001
|
||
|
a.
|
Relates
to Escarpment Village, which Stratus sold on October 12, 2007. The
2006
amounts also include results from 7000 West, which Stratus sold on
March
27, 2006.
|
III