Vector Group Ltd. (NYSE:VGR) today announced financial results
for the three months ended March 31, 2015.
GAAP Financial Results
First quarter 2015 revenues were $360.8 million, compared to
revenues of $347.2 million in the first quarter of 2014. The
increase in revenues in 2015 was primarily due to an increase of
revenues at Douglas Elliman Realty, LLC. The Company recorded
operating income of $44.0 million in the first quarter of 2015,
compared to operating income of $42.7 million in the first quarter
of 2014. Net income attributed to Vector Group Ltd. for the 2015
first quarter was $21.0 million, or $0.18 per diluted common share,
compared to net income of $2.6 million, or $0.03 per diluted common
share, in the 2014 first quarter.
Non-GAAP Financial Results
Non-GAAP financial results also include adjustments for purchase
accounting associated with the Company's acquisition of its
additional 20.59% interest in Douglas Elliman Realty, LLC in
December 2013, litigation settlement and judgment expenses in the
Company's tobacco business, non-cash stock compensation expense
(for purposes of Pro-forma Adjusted EBITDA only), and non-cash
interest items associated with the Company's convertible debt.
Reconciliations of non-GAAP financial results to the comparable
GAAP financial results for the three months ended March 31,
2015 and 2014 are included in Tables 2 through 10.
Three months ended March 31, 2015 compared to the three
months ended March 31, 2014
First quarter 2015 Pro-forma Adjusted Revenues (as described in
Table 2 attached hereto) were $361.2 million compared to $348.9
million in 2014. The increase was primarily due to an increase in
Pro-forma Adjusted Revenues at Douglas Elliman of $21.0 million.
This was offset by a decrease in Pro-forma Adjusted Revenues of
$5.3 million and $5.4 million from the Company's tobacco segment
and E-cigarette segment, respectively.
Pro-forma Adjusted EBITDA attributed to Vector Group (as
described below and in Table 3 attached hereto) were $51.5 million
for the first quarter of 2015 as compared to $49.8 million for the
first quarter of 2014. The increase in Pro-forma Adjusted EBITDA
attributed to Vector Group for the three months ended March 31,
2015 was primarily attributable to higher profits in the tobacco
segment. This was offset by a decline of Pro-forma Adjusted EBITDA
at Douglas Elliman as well as increased losses from the Company’s
E-cigarette segment in the 2015 period.
Pro-forma Adjusted Net Income (as described below and in Table 4
attached hereto) was $21.9 million or $0.19 per diluted share for
the three months ended March 31, 2015 and $14.6 million or $0.14
per diluted share for the three months ended March 31, 2014.
Pro-forma Adjusted Operating Income (as described below and in
Table 5 attached hereto) was $46.6 million for the three months
ended March 31, 2015 and $47.6 million for the three months ended
March 31, 2014.
Tobacco Business Financial Results
For the first quarter 2015, the Company's tobacco business had
revenues of $228.1 million, compared to $233.4 million for the
first quarter 2014. The decline in revenues was primarily due to a
4.9% decline in unit sales volume offset by favorable net pricing
variances. Tobacco Adjusted Operating Income (described below and
included in Table 6 attached hereto) for the first quarter 2015 and
2014 was $50.5 million and $44.4 million, respectively.
For the three months ended March 31, 2015, the Company's tobacco
business had conventional cigarette sales of approximately 1.93
billion units compared to 2.03 billion units for the three months
ended March 31, 2014.
Real Estate Business Financial Results
For the first quarter 2015, the Company's real estate segment
had Pro-forma Adjusted Revenues of $132.7 million, compared to
$109.7 million for the first quarter 2014. The increase in revenues
was primarily due to an increase in revenues at Douglas Elliman.
For the first quarter 2015, Real Estate Pro-forma Adjusted EBITDA
attributed to the Company were $4.3 million, compared to $7.1
million for the first quarter 2014.
Douglas Elliman's results are included in Vector Group Ltd.'s
Real Estate segment and Douglas Elliman continued its strong growth
by reporting increases in its Pro-Forma Adjusted Revenues of 19.3%
for the three months ended March 31, 2015 from the comparable 2014
period. During the quarter, Douglas Elliman continued to make
strategic investments by bolstering its development marketing
division and incurring increased advertising and marketing expenses
to strengthen the long-term value of the Douglas Elliman brand.
Douglas Elliman's Pro-Forma Adjusted Revenues for the first
quarter 2015 were $130.2 million, compared to $109.2 million for
the first quarter 2014. For the first quarter 2015, Douglas
Elliman's Pro-forma Adjusted EBITDA were $3.7 million ($2.6 million
attributed to the Company), compared to $7.4 million ($5.2 million
attributed to the Company) for the first quarter 2014.
For the three months ended March 31, 2015, Douglas Elliman
achieved closed sales of approximately $4.1 billion, compared to
$3.5 billion for the three months ended March 31, 2014.
E-cigarettes
For the three months ended March 31, 2015, the Company's
E-cigarette segment had Pro-forma Adjusted Revenues of $0.4 million
and a loss of Pro-forma Adjusted EBITDA of $3.2 million compared to
Pro-forma Adjusted Revenues of $5.8 million and a loss of Pro-forma
Adjusted EBITDA of $0.4 million for the three months ended March
31, 2014.
As a result of the amount of operating losses in the Company's
E-cigarette segment, effective as of September 30, 2014, when
compared to the remaining components of the Company's Corporate and
Other segment, the Company has reevaluated its operating segments
and has separated the operations of the Company's E-cigarette
segment from the Corporate and Other segment for previously
reported 2014 period. Thus, information reported prior to September
30, 2014 has been recast to conform to the current presentation.
This change did not have an impact to the Company's historical
consolidated results.
Non-GAAP Financial Measures
Pro-forma Adjusted Revenues, Pro-forma Adjusted EBITDA,
Pro-forma Adjusted Net Income, Pro-forma Adjusted Operating Income,
Tobacco Adjusted Operating Income, New Valley LLC Pro-forma
Adjusted Revenues, New Valley LLC Pro-forma Adjusted EBITDA,
Douglas Elliman Realty, LLC Adjusted Revenues, and Douglas Elliman
Realty, LLC Adjusted EBITDA are financial measures not prepared in
accordance with generally accepted accounting principles (“GAAP”).
The Company believes that Pro-forma Adjusted Revenues, Pro-forma
Adjusted EBITDA, Pro-forma Adjusted Net Income, Pro-forma Adjusted
Operating Income, Tobacco Adjusted Operating Income, New Valley LLC
Pro-forma Adjusted Revenues, New Valley LLC Pro-forma Adjusted
EBITDA, Douglas Elliman Realty, LLC Adjusted Revenues, and Douglas
Elliman Realty, LLC Adjusted EBITDA are important measures that
supplement discussions and analysis of its results of operations
and enhances an understanding of its operating performance. The
Company believes Pro-forma Adjusted Revenues, Pro-forma Adjusted
EBITDA, Pro-forma Adjusted Net Income, Pro-forma Adjusted Operating
Income, Tobacco Adjusted Operating Income, New Valley LLC Pro-forma
Adjusted Revenues, New Valley LLC Pro-forma Adjusted EBITDA,
Douglas Elliman Realty, LLC Adjusted Revenues, and Douglas Elliman
Realty, LLC Adjusted EBITDA provide investors and analysts with a
useful measure of operating results unaffected by differences in
capital structures, capital investment cycles and ages of related
assets among otherwise comparable companies. Management uses
Pro-forma Adjusted Revenues, Pro-forma Adjusted EBITDA, Pro-forma
Adjusted Net Income, Pro-forma Adjusted Operating Income, Tobacco
Adjusted Operating Income, New Valley LLC Pro-forma Adjusted
Revenues, New Valley LLC Pro-forma Adjusted EBITDA, Douglas Elliman
Realty, LLC Adjusted Revenues, and Douglas Elliman Realty, LLC
Adjusted EBITDA as measures to review and assess operating
performance of the Company's business, and management and investors
should review both the overall performance (GAAP net income) and
the operating performance (Pro-forma Adjusted Revenues, Pro-forma
Adjusted EBITDA, Pro-forma Adjusted Net Income, Pro-forma Adjusted
Operating Income, Tobacco Adjusted Operating Income, New Valley LLC
Pro-forma Adjusted Revenues, New Valley LLC Pro-forma Adjusted
EBITDA, Douglas Elliman Realty, LLC Adjusted Revenues, and Douglas
Elliman Realty, LLC Adjusted EBITDA) of the Company's business.
While management considers Pro-forma Adjusted Revenues, Pro-forma
Adjusted EBITDA, Pro-forma Adjusted Net Income, Pro-forma Adjusted
Operating Income, Tobacco Adjusted Operating Income, New Valley LLC
Pro-forma Adjusted Revenues, New Valley LLC Pro-forma Adjusted
EBITDA, Douglas Elliman Realty, LLC Adjusted Revenues, and Douglas
Elliman Realty, LLC Adjusted EBITDA to be important, they should be
considered in addition to, but not as substitutes for or superior
to, other measures of financial performance prepared in accordance
with GAAP, such as operating income, net income and cash flows from
operations. In addition, Pro-forma Adjusted Revenues, Pro-forma
Adjusted EBITDA, Pro-forma Adjusted Net Income, Pro-forma Adjusted
Operating Income, Tobacco Adjusted Operating Income, New Valley LLC
Pro-forma Adjusted Revenues, New Valley LLC Pro-forma Adjusted
EBITDA, Douglas Elliman Realty, LLC Adjusted Revenues, and Douglas
Elliman Realty, LLC Adjusted EBITDA are susceptible to varying
calculations and the Company's measurement of Pro-forma Adjusted
Revenues, Pro-forma Adjusted EBITDA, Pro-forma Adjusted Net Income,
Pro-forma Adjusted Operating Income, Tobacco Adjusted Operating
Income, New Valley LLC Pro-forma Adjusted Revenues, New Valley LLC
Pro-forma Adjusted EBITDA, Douglas Elliman Realty, LLC Adjusted
Revenues, and Douglas Elliman Realty, LLC Adjusted EBITDA may not
be comparable to those of other companies. Attached hereto as
Tables 2 through 10 is information relating to the Company's
Pro-forma Adjusted Revenues, Pro-forma Adjusted EBITDA, Pro-forma
Adjusted Net Income, Pro-forma Adjusted Operating Income, Tobacco
Adjusted Operating Income, New Valley LLC Pro-forma Adjusted
Revenues, New Valley LLC Pro-forma Adjusted EBITDA, Douglas Elliman
Realty, LLC Adjusted Revenues, and Douglas Elliman Realty, LLC
Adjusted EBITDA for the three months ended March 31, 2015 and
2014.
Conference Call to Discuss First Quarter 2015 Results
As previously announced, the Company will host a conference call
and webcast on Thursday, April 30, 2015 at 9:00 A.M. (ET) to
discuss first quarter 2015 results. Investors can access the call
by dialing 800-859-8150 and entering 32611460 as the
conference ID number. The call will also be available via live
webcast at www.investorcalendar.com.
Webcast participants should allot extra time to register before the
webcast begins.
A replay of the call will be available shortly after the call
ends on April 30, 2015 through May 30, 2015. To access the
replay, dial 877-656-8905 and enter 32611460 as the
conference ID number. The archived webcast will also be available
at www.investorcalendar.com for one
year.
Vector Group is a holding company that indirectly
owns Liggett Group LLC, Vector Tobacco
Inc. and Zoom E-Cigs LLC and directly owns New
Valley LLC, which owns a controlling interest in Douglas
Elliman Realty, LLC. Additional information concerning the company
is available on the Company's website, www.VectorGroupLtd.com.
[Financial Tables Follow]
TABLE 1 VECTOR GROUP LTD. AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(Dollars in
Thousands, Except Per Share Amounts)
Three Months Ended March 31, 2015 2014 (Unaudited)
Revenues Tobacco* $ 228,085 $ 233,392 Real estate 132,256
108,044 E-Cigarettes 419 5,800 Total revenues 360,760
347,236 Expenses: Cost of sales: Tobacco* 157,030 168,166
Real estate 84,358 67,324 E-Cigarettes 630 3,547
Total cost of sales 242,018 239,037 Operating, selling,
administrative and general expenses 73,944 63,977 Litigation
settlement and judgment expense 843 1,500 Operating
income 43,955 42,722 Other income (expenses): Interest
expense (31,746 ) (35,453 ) Change in fair value of derivatives
embedded within convertible debt 6,460 (1,650 ) Acceleration of
interest expense related to debt conversion — (3,679 ) Equity
income from real estate ventures 338 1,552 Equity (loss) income on
long-term investments (37 ) 906 Gain (loss) on sale of investment
securities available for sale 13,029 (53 ) Other, net 1,896
2,126 Income before provision for income taxes 33,895 6,471
Income tax expense 12,679 2,942 Net income
21,216 3,529 Net income attributed to non-controlling
interest (260 ) (949 ) Net income attributed to Vector Group
Ltd. $ 20,956 $ 2,580 Per basic common share:
Net income applicable to common shares attributed to Vector
Group Ltd. $ 0.18 $ 0.03 Per diluted common
share: Net income applicable to common shares attributed to
Vector Group Ltd. $ 0.18 $ 0.03 Cash
distributions and dividends declared per share $ 0.40 $ 0.38
* Revenues and Cost of goods sold include
excise taxes of $97,359 and $102,413, respectively.
TABLE 2 VECTOR GROUP LTD. AND
SUBSIDIARIES RECONCILIATION OF PRO-FORMA ADJUSTED
REVENUES (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Revenues $ 1,604,839 $ 360,760 $ 347,236
Purchase accounting adjustments (a) 595 481 1,654
Total adjustments 595 481 1,654 Pro-forma Adjusted Revenues
$ 1,605,434 $ 361,241 $ 348,890
Pro-forma
Adjusted Revenues by Segment Tobacco $ 1,015,952 $ 228,085 $
233,392 E-cigarettes 3,208 419 5,800 Real Estate (b) 586,274
132,737 109,698 Corporate and Other — — — Total $
1,605,434 $ 361,241 $ 348,890 a.
Amounts represent purchase accounting adjustments recorded in the
periods presented in connection with the increase of the Company's
ownership of Douglas Elliman Realty, LLC, which occurred in 2013.
b. Includes Pro-forma Adjusted Revenues from Douglas Elliman
Realty, LLC of $564,263 for the last twelve months ended March 31,
2015 and $130,228, and $109,195 for the three months ended March
31, 2015 and 2014, respectively.
TABLE 3 VECTOR GROUP LTD. AND SUBSIDIARIES
COMPUTATION OF PRO-FORMA ADJUSTED EBITDA (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Net income attributed to Vector Group Ltd. $ 55,354 $
20,956 $ 2,580 Interest expense 157,284 31,746 35,453 Income
tax expense 42,988 12,679 2,942 Net income attributed to
non-controlling interest 11,569 260 949 Depreciation and
amortization 23,688 6,281 7,092 EBITDA $
290,883 $ 71,922 $ 49,016 Change in fair value of derivatives
embedded within convertible debt (a) (27,519 ) (6,460 ) 1,650
Equity (gain) loss on long-term investments (b) (299 ) 37 (906 )
(Gain) loss on sale of investment securities available for sale
(13,071 ) (13,029 ) 53 Equity income from real estate ventures (c)
(2,889 ) (338 ) (1,552 ) Acceleration of interest expense related
to debt conversion 1,526 — 3,679 Stock-based compensation expense
(d) 3,892 1,164 523 Litigation settlement and judgment expense (e)
1,818 843 1,500 Impact of MSA Settlement (f) (1,419 ) — — Purchase
accounting adjustments (g) 1,571 332 239 Other, net (10,322 )
(1,896 ) (2,126 ) Pro-forma Adjusted EBITDA $ 244,171 $ 52,575 $
52,076 Pro-forma Adjusted EBITDA attributed to non-controlling
interest (14,700 ) (1,084 ) (2,242 ) Pro-forma Adjusted EBITDA
attributed to Vector Group Ltd. $ 229,471 $ 51,491 $
49,834
Pro-forma Adjusted EBITDA by Segment
Tobacco $ 217,725 $ 53,472 $ 46,915 E-cigarettes (15,863 ) (3,164 )
(425 ) Real Estate (h) 52,097 5,391 9,330 Corporate and Other
(9,788 ) (3,124 ) (3,744 ) Total $ 244,171 $ 52,575 $
52,076
Pro-forma Adjusted EBITDA Attributed to
Vector Group by Segment Tobacco $ 217,725 $ 53,472 $ 46,915
E-cigarettes (15,863 ) (3,164 ) (425 ) Real Estate (i) 37,397 4,307
7,088 Corporate and Other (9,788 ) (3,124 ) (3,744 ) Total $
229,471 $ 51,491 $ 49,834 a.
Represents income or losses recognized from changes in the fair
value of the derivatives embedded in the Company's convertible
debt. b. Represents income or losses recognized on long-term
investments that the Company accounts for under the equity method.
c. Represents equity income recognized from the Company's
investment in certain real estate businesses that are not
consolidated in its financial results. d. Represents amortization
of stock-based compensation. e. Represents accrual for a settlement
of an Engle progeny judgment. f. Represents the Company's tobacco
business's settlement of a long-standing dispute related to the
Master Settlement Agreement. g. Amounts represent purchase
accounting adjustments recorded in the periods presented in
connection with the increase of the Company's ownership of Douglas
Elliman Realty, LLC, which occurred in 2013. h. Includes Pro-forma
Adjusted EBITDA for Douglas Elliman Realty, LLC of $46,956 for the
last twelve months ended March 31, 2015 and $3,685 and $7,384 for
the three months ended March 31, 2015 and 2014, respectively.
Amounts reported in this footnote reflect 100% of Douglas Elliman
Realty, LLC's entire Pro-forma Adjusted EBITDA. i. Includes
Pro-forma Adjusted EBITDA for Douglas Elliman Realty, LLC less
non-controlling interest of $33,146 for the last twelve months
ended March 31, 2015 and $2,601 and $5,212 the three months ended
March 31, 2015 and 2014, respectively. Amounts reported in this
footnote have adjusted Douglas Elliman Realty, LLC's Pro-forma
Adjusted EBITDA for non-controlling interest.
TABLE 4 VECTOR GROUP LTD. AND SUBSIDIARIES
RECONCILIATION OF PRO-FORMA ADJUSTED NET INCOME
(Unaudited)
(Dollars in
Thousands, Except Per Share Amounts)
Three Months Ended March 31, 2015 2014 Net
income attributed to Vector Group Ltd. $ 20,956 $ 2,580
Acceleration of interest expense related to debt conversion
— 3,679 Change in fair value of derivatives embedded within
convertible debt (6,460 ) 1,650 Non-cash amortization of debt
discount on convertible debt 5,943 12,456 Litigation settlement and
judgment expense (a) 843 1,500 Out-of-period adjustment
related to Douglas Elliman acquisition in 2013 (b) — (1,231 )
Douglas Elliman Realty, LLC purchase accounting adjustments (c)
1,251 2,356 Total adjustments 1,577 20,410 Tax
expense related to adjustments (652 ) (8,440 )
Pro-forma Adjusted Net Income attributed to Vector Group Ltd. $
21,881 $ 14,550 Per diluted common share:
Pro-forma Adjusted Net Income applicable to common shares
attributed to Vector Group Ltd. $ 0.19 $ 0.14
a. Represents accrual for a settlement of an Engle progeny
judgment. b. Represents an out-of-period adjustment related to a
non-accrual of a receivable from Douglas Elliman Realty in the
fourth quarter of 2013 and would have increased the Company's gain
on acquisition of Douglas Elliman in 2013. c. Represents 70.59% of
purchase accounting adjustments in the periods presented for assets
acquired in connection with the increase of the Company's ownership
of Douglas Elliman Realty, LLC, which occurred in 2013.
TABLE 5 VECTOR GROUP LTD. AND
SUBSIDIARIES RECONCILIATION OF PRO-FORMA ADJUSTED OPERATING
INCOME (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Operating income $ 214,621 $ 43,955 $ 42,722
Litigation settlement and judgment expense (a) 1,818 843
1,500 Impact of MSA Settlement (b) (1,419 ) — — Douglas
Elliman purchase accounting adjustments (c) 6,962 1,772
3,337 Total adjustments 7,361 2,615 4,837 Pro-forma
Adjusted Operating Income (d) $ 221,982 $ 46,570 $
47,559 a. Represents accrual for a settlement of an
Engle progeny judgment. b. Represents the Company's tobacco
segment's settlement of a long-standing dispute related to the
Master Settlement Agreement. c. Amounts represent purchase
accounting adjustments recorded in the periods presented in
connection with the increase of the Company's ownership of Douglas
Elliman Realty, LLC, which occurred in 2013. d. Does not include a
reduction for 29.41% non-controlling interest in Douglas Elliman
Realty, LLC.
TABLE 6 VECTOR
GROUP LTD. AND SUBSIDIARIES RECONCILIATION OF TOBACCO
ADJUSTED OPERATING INCOME (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Operating income from tobacco business $ 205,893 $
49,670 $ 42,896 Litigation settlement and judgment
expense (a) 1,818 843 1,500 Impact of MSA Settlement (b) (1,419 ) —
— Total adjustments 399 843 1,500 Tobacco Adjusted
Operating Income $ 206,292 $ 50,513 $ 44,396
a. Represents accruals for settlements of judgments in the
Engle progeny tobacco litigation. b. Represents the Company's
tobacco segment's settlement of a long-standing dispute related to
the Master Settlement Agreement.
TABLE 7 VECTOR GROUP LTD. AND SUBSIDIARIES
ANALYSIS OF NEW VALLEY LLC PRO-FORMA ADJUSTED REVENUES
(Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 New Valley LLC revenues $ 585,679 $ 132,256 $
108,044 Purchase accounting adjustments (a) 595 481
1,654 Total adjustments 595 481 1,654 New Valley LLC
Pro-forma Adjusted Revenues (b) $ 586,274 $ 132,737 $
109,698 a. Amounts represent purchase accounting
adjustments recorded in connection with the increase of the
Company's ownership of Douglas Elliman Realty, LLC. b. Includes
Pro-forma Adjusted Revenues from Douglas Elliman Realty, LLC of
$564,263 for the last twelve months ended March 31, 2015 and
$130,228, and $109,195 for the three months ended March 31, 2015
and 2014, respectively.
TABLE 8
VECTOR GROUP LTD. AND SUBSIDIARIES COMPUTATION OF NEW
VALLEY LLC PRO-FORMA ADJUSTED EBITDA (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Net income attributed to Vector Group Ltd. from
subsidiary non-guarantors (a) $ 19,645 $ 1,450 $ 3,225
Interest expense (a) 8 1 34 Income tax expense (a) 15,195 1,308
3,541 Net income (loss) attributed to non-controlling interest (a)
11,569 260 949 Depreciation and amortization 10,765
2,908 4,347 EBITDA $ 57,182 $ 5,927 $ 12,096 Income
from non-guarantors other than New Valley 91 16 18 Equity income
from real estate ventures (b) (2,889 ) (338 ) (1,552 ) Purchase
accounting adjustments (c) 1,571 332 239 Other, net (3,852 )
(552 ) (1,486 ) Pro-forma Adjusted EBITDA $ 52,103 $ 5,385 $ 9,315
Pro-forma Adjusted EBITDA attributed to non-controlling interest
(14,700 ) (1,084 ) (2,242 ) Pro-forma Adjusted EBITDA
attributed to New Valley LLC $ 37,403 $ 4,301
$ 7,073 Pro-forma Adjusted EBITDA by Segment Real
Estate (d) $ 52,097 $ 5,391 $ 9,330 Corporate and Other 6
(6 ) (15 ) Total (f) $ 52,103 $ 5,385 $
9,315 Pro-forma Adjusted EBITDA Attributed to New
Valley LLC by Segment Real Estate (e) $ 37,397 $ 4,307 $ 7,088
Corporate and Other 6 (6 ) (15 ) Total (f) $ 37,403
$ 4,301 $ 7,073 a.
Amounts are derived from Vector Group Ltd.'s Consolidated Financial
Statements. See Note entitled "Vector Group Ltd.'s Condensed
Consolidating Financial Information" contained in Vector Group
Ltd.'s Form 10-K and Form 10-Q for the year ended December 31, 2014
and the quarterly period ended March 31, 2015, respectively b.
Represents equity income recognized from the Company's investment
in certain real estate businesses that are not consolidated in its
financial results. c. Amounts represent purchase accounting
adjustments recorded in the periods presented in connection with
the increase of the Company's ownership of Douglas Elliman Realty,
LLC, which occurred in 2013. d. Includes Pro-forma Adjusted EBITDA
for Douglas Elliman Realty, LLC of $46,956 for the twelve months
ended March 31, 2015 and $3,685 and $7,384 for the three months
ended March 31, 2015 and 2014, respectively. Amounts reported in
this footnote reflect 100% of Douglas Elliman Realty, LLC's entire
Pro-forma Adjusted EBITDA. e. Includes Pro-forma Adjusted EBITDA
for Douglas Elliman Realty, LLC less non-controlling interest of
$33,146 for the last twelve months ended March 31, 2015 and $2,601
and $5,212 the three months ended March 31, 2015 and 2014,
respectively. Amounts reported in this footnote have adjusted
Douglas Elliman Realty, LLC's Pro-forma Adjusted EBITDA for
non-controlling interest. f. New Valley's Pro-forma Adjusted EBITDA
does not include an allocation of Vector Group Ltd.'s "Corporate
and Other" segment's expenses (for purposes of computing Pro-Forma
Adjusted EBITDA contained in Table 3 of this press release) of
$9,788 for the last twelve months ended March 31, 2015 and $3,124
and $3,744 for the three months ended March 31, 2015 and 2014,
respectively.
TABLE 9 VECTOR
GROUP LTD. AND SUBSIDIARIES ANALYSIS OF DOUGLAS ELLIMAN
REALTY, LLC PRO-FORMA ADJUSTED REVENUES (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Douglas Elliman Realty, LLC revenues $ 563,668 $
129,747 $ 107,541 Purchase accounting adjustments (a)
595 481 1,654 Total adjustments 595 481 1,654
Douglas Elliman Realty, LLC Pro-forma Adjusted Revenues $ 564,263
$ 130,228 $ 109,195 a. Amounts
represent purchase accounting adjustments recorded in the periods
presented in connection with the increase of the Company's
ownership of Douglas Elliman Realty, LLC, which occurred in 2013.
TABLE 10 VECTOR GROUP LTD.
AND SUBSIDIARIES COMPUTATION OF DOUGLAS ELLIMAN REALTY, LLC
PRO-FORMA ADJUSTED EBITDA (Unaudited)
(Dollars in
Thousands)
LTM Three Months Ended March 31, March 31, 2015 2015
2014 Net income attributed to Douglas Elliman Realty, LLC $
36,071 $ 885 $ 3,228 Interest expense 7 1 32 Income tax
expense 1,438 243 179 Depreciation and amortization 10,458
2,849 4,246 Douglas Elliman Realty, LLC EBITDA $
47,974 $ 3,978 $ 7,685 Equity income from real estate
ventures (a) (183 ) (593 ) (520 ) Purchase accounting adjustments
(b) 1,571 332 239 Other, net (2,406 ) (32 ) (20 ) Douglas
Elliman Realty, LLC Pro-forma Adjusted EBITDA $ 46,956 $
3,685 $ 7,384 a. Represents equity
income recognized from the Company's investment in certain real
estate businesses that are not consolidated in its financial
results. b. Amounts represent purchase accounting adjustments
recorded in the periods presented in connection with the increase
of the Company's ownership of Douglas Elliman Realty, LLC, which
occurred in 2013.
Sard Verbinnen & CoEmily Deissler/Benjamin
Spicehandler/Spencer Waybright212-687-8080orSard Verbinnen & Co
- EuropeJonathan Doorley/Conrad Harrington+44 (0)20 3178
8914orVector Group Ltd.J. Bryant Kirkland III,305-579-8000
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