Reconciliation of Projected Net Income and Funds from Operations Related to PTO Lease Activity
This document provides a financial reconciliation showing the projected impact on net income and funds from operations (FFO) resulting from the PTO vacating its previously occupied space and the subsequent leasing of that space. It presents annual figures from 2004 to 2008 and explains that FFO is a supplemental measure used by management to compare operating performance among REITs, though it is not a substitute for net income or cash flow measures under U.S. accounting standards.
Exhibit 1.2
Below is a reconciliation of the projected impact on Net Income and on Funds from Operations (“FFO”) of the PTO vacating space it previously occupied and its subsequent lease up:
| ($ IN MILLIONS) |
| 2008 |
| 2007 |
| 2006 |
| 2005 |
| 2004 |
|
| Net Income (Loss) |
| 5.3 |
| 1.2 |
| (12.2 | ) | (15.0 | ) | (2.4 | ) |
| Depreciation |
| 8.2 |
| 7.7 |
| 7.0 |
| .7 |
| .9 |
|
| Funds from Operations |
| 13.5 |
| 8.9 |
| (5.2 | ) | (14.3 | ) | (1.5 | ) |
FFO does not represent cash generated from operating activities in accordance with accounting principles generally accepted in the United States of America and is not necessarily indicative of cash available to fund cash needs which would be disclosed in the Consolidated Statements of Cash Flows for the applicable periods. FFO should not be considered as an alternative to net income as an indicator of the Company’s operating performance or as an alternative to cash flows as a measure of liquidity. Management considers FFO a relevant supplement measure of operating performance because it provides a basis for comparison among REITs. FFO is computed in accordance with NAREIT’s definition, which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with NAREIT’s definition.
