Record High Quarterly Revenues and Robust
Operating Income
Continued Strong Earnings Momentum in
Tobacco and Real Estate Segments
Second Quarter 2021 Highlights:
- Consolidated revenues of $729.5 million, up 64% or $283.8
million compared to the prior year period
- Real Estate segment revenues of $400.0 million, up 200% or
$266.8 million compared to the prior year period
- Douglas Elliman’s closed sales volume of $14.5 billion, up 209%
or $9.8 billion compared to the prior year period
- Reported net income of $93.3 million or $0.61 per diluted
share, up $67.5 million compared to the prior year period; Adjusted
Net Income of $96.5 million or $0.63 per diluted share, up $67.8
million compared to the prior year period
- Reported operating income of $137.1 million, up $70.3
million compared to the prior year period
- Tobacco segment operating income of $103.2 million, up 30% or
$23.9 million compared to the prior year period
- Real Estate segment operating income of $42.4 million, up $49.2
million compared to the prior year period
- Adjusted EBITDA of $144.2 million, up 89% or $67.7 million
compared to the prior year period
- Tobacco segment Adjusted EBITDA of $104.9 million, up 29% or
$23.5 million compared to the prior year period
- Real Estate segment Adjusted EBITDA of $44.6 million, up $46.3
million compared to the prior year period
Year-to-date 2021 Highlights:
- Consolidated revenues of $1.27 billion, up 41% or $373.0
million compared to the prior year period
- Real Estate segment revenues of $675.3 million, up 125% or
$374.7 million compared to the prior year period
- Douglas Elliman’s closed sales volume of $24.6 billion, up 128%
or $13.8 billion compared to the prior year period
- Reported net income of $125.3 million or $0.81 per diluted
share, up $102.7 million compared to the prior year period;
Adjusted Net Income of $141.8 million or $0.92 per diluted share,
up $73.2 million compared to the prior year period
- Reported operating income of $227.3 million, up $165.4
million compared to the prior year period
- Tobacco segment operating income of $184.8 million, up 24% or
$36.3 million compared to the prior year period
- Real Estate segment operating income of $57.6 million, up
$132.0 million compared to the prior year period
- Adjusted EBITDA of $238.6 million, up 75% or $101.9 million
compared to the prior year period
- Tobacco segment Adjusted EBITDA of $185.5 million, up 22% or
$32.9 million compared to the prior year period
- Real Estate segment Adjusted EBITDA of $62.1 million, up $70.7
million compared to the prior year period
- Strong liquidity with cash and cash equivalents of $490
million and investment securities and long-term investments of $212
million at June 30, 2021
- Cash dividends of $63 million returned to stockholders at a
rate of $0.40 per common share
Last Twelve Months ended June 30, 2021 Highlights:
- Consolidated revenues of $2.38 billion
- Tobacco segment revenues of $1.20 billion
- Real Estate segment revenues of $1.17 billion
- Douglas Elliman’s closed sales volume of $42.9 billion
- Net income of $195.7 million
- Real Estate segment net income of $42.4 million
- Operating income of $410.5 million
- Tobacco segment operating income of $355.8 million
- Adjusted EBITDA of $435.3 million
- Tobacco segment Adjusted EBITDA of $361.0 million
- Real Estate segment Adjusted EBITDA of $92.5 million
Vector Group Ltd. (NYSE:VGR) today announced
second quarter 2021 financial results.
“Vector had another outstanding quarter, achieving all-time high
quarterly revenues and significantly increased operating income in
both our Tobacco and Real Estate segments,” said Howard Lorber,
President and Chief Executive Officer of Vector Group.
“We are excited by the continued strong performance of our
tobacco business which validates our market strategy and reflects
the competitive advantages we have in the deep discount segment, as
demonstrated by increased Adjusted EBITDA during the quarter. Our
Douglas Elliman subsidiary also delivered record revenues up 195%
compared to the year ago period, and closed sales volume was up
209% over the same timeframe. Combined with expense reductions,
Douglas Elliman achieved record quarterly Adjusted EBITDA during
the second quarter.”
GAAP Financial Results
Three months ended June 30, 2021 and 2020. Second quarter 2021
revenues were $729.5 million, compared to revenues of $445.8
million in the second quarter of 2020. The Company recorded
operating income of $137.1 million in the second quarter of 2021,
compared to operating income of $66.8 million in the second quarter
of 2020. Net income attributed to Vector Group Ltd. for the second
quarter of 2021 was $93.3 million, or $0.61 per diluted common
share, compared to net income of $25.8 million, or $0.16 per
diluted common share, in the second quarter of 2020. Operating
income and net income for the second quarter of 2020 included
pretax restructuring charges of $3.0 million in the Company’s Real
Estate segment.
Six months ended June 30, 2021 and 2020. For the six months
ended June 30, 2021, revenues were $1.27 billion, compared to
revenues of $900.2 million for the six months ended June 30, 2020.
The Company recorded operating income of $227.3 million for the six
months ended June 30, 2021, compared to operating income of $61.9
million for the six months ended June 30, 2020. Net income
attributed to Vector Group Ltd. for the six months ended June 30,
2021 was $125.3 million, or $0.81 per diluted common share,
compared to net income of $22.5 million, or $0.14 per diluted
common share, for the six months ended June 30, 2020. Operating
income and net income for the six months ended June 30, 2020
included pre-tax and non-cash impairment charges of $58.3 million
and pre-tax restructuring charges of $3.0 million in the Company’s
Real Estate segment.
Non-GAAP Financial Measures
Non-GAAP financial measures include adjustments for change in
fair value of derivatives embedded within convertible debt, loss on
extinguishment of debt, litigation settlements and judgment
expense, impact of Master Settlement Agreement settlements,
restructuring charges, net gains on sales of assets (for purposes
of Adjusted EBITDA and Adjusted Operating Income only), and
impairments of goodwill and other intangible assets. For purposes
of Adjusted EBITDA only, adjustments include equity in earnings
from investments, equity in (earnings) losses from real estate
ventures, stock-based compensation expense, and other, net. For
purposes of Adjusted Net Income only, adjustments include non-cash
amortization of debt discount on convertible debt, net interest
expense capitalized to real estate ventures, and the derivative
associated with the 2018 acquisition of 29.41% of Douglas Elliman.
Reconciliations of non-GAAP financial measures to the comparable
GAAP financial results for the last twelve months ended June 30,
2021 and the three and six months ended June 30, 2021 and 2020 are
included in Tables 2 through 8.
Three months ended June 30, 2021 compared to the three months
ended June 30, 2020
Adjusted EBITDA attributed to Vector (as described in Table 2
attached hereto) were $144.2 million for the second quarter of
2021, compared to $76.5 million for the second quarter of 2020.
Adjusted Net Income (as described in Table 3 attached hereto)
was $96.5 million, or $0.63 per diluted share, for the second
quarter of 2021, and $28.7 million or $0.19 per diluted share, for
the second quarter of 2020.
Adjusted Operating Income (as described in Table 4 attached
hereto) was $137.1 million for the second quarter of 2021, compared
to $69.8 million for the second quarter of 2020.
Six months ended June 30, 2021 compared to the six months ended
June 30, 2020
Adjusted EBITDA attributed to Vector (as described in Table 2
attached hereto) were $238.6 million for the six months ended June
30, 2021, compared to $136.7 million for the six months ended June
30, 2020.
Adjusted Net Income (as described in Table 3 attached hereto)
was $141.8 million, or $0.92 per diluted share, for the six months
ended June 30, 2021, compared to $68.6 million, or $0.45 per
diluted share, for the six months ended June 30, 2020.
Adjusted Operating Income (as described in Table 4 attached
hereto) was $224.6 million for the six months ended June 30, 2021,
compared to $123.2 million for the six months ended June 30,
2020.
Last twelve months ended June 30, 2021
For the last twelve months ended June 30, 2021, revenues were
$2.38 billion. The Company recorded operating income of $410.5
million for the last twelve months ended June 30, 2021. Net income
attributed to Vector Group Ltd. for the last twelve months ended
June 30, 2021 was $195.7 million.
For the last twelve months ended June 30, 2021, Adjusted EBITDA
attributed to Vector (as described in Table 2 attached hereto) were
$435.3 million. Adjusted Operating Income (as described in Table 4
attached hereto) was $407.7 million for the last twelve months
ended June 30, 2021.
Consolidated Balance Sheet
Vector maintained significant liquidity at June 30, 2021 with
cash and cash equivalents of $490 million, including $108 million
of cash at Liggett and $155 million of cash at Douglas Elliman.
Vector also held investment securities of $157 million and
long-term investments of $55 million.
Vector continued its longstanding history of paying a quarterly
cash dividend in the second quarter of 2021. For the six months
ended June 30, 2021, Vector returned a total of $63 million to
stockholders at a quarterly rate of $0.20 per common share.
Tobacco Segment Financial Results
For the second quarter of 2021, the Tobacco segment had revenues
of $329.5 million, compared to $312.5 million for the second
quarter of 2020. For the six months ended June 30, 2021, the
Tobacco segment had revenues of $598.0 million, compared to $599.6
million for the six months ended June 30, 2020. For the last twelve
months ended June 30, 2021, the Tobacco segment had revenues of
$1.2 billion.
Operating Income from the Tobacco segment was $103.2 million and
$184.8 million for the three and six months ended June 30, 2021,
respectively, compared to $79.3 million and $148.5 million for the
three and six months ended June 30, 2020, respectively. Operating
Income from the Tobacco segment was $355.8 million for the last
twelve months ended June 30, 2021.
Non-GAAP Financial Measures
Tobacco Adjusted Operating Income (as described in Table 5
attached hereto) for the second quarter of 2021 and 2020 was $103.2
million and $79.4 million, respectively. Tobacco Adjusted Operating
Income for the six months ended June 30, 2021 was $182.1 million,
compared to $148.5 million for the six months ended June 30, 2020.
Tobacco Adjusted Operating Income for the last twelve months ended
June 30, 2021 was $353.7 million.
For the second quarter of 2021, the Tobacco segment had
conventional cigarette (wholesale) shipments of approximately 2.36
billion units, compared to 2.41 billion units for the second
quarter of 2020. For the six months ended June 30, 2021, the
Tobacco segment had conventional cigarette (wholesale) shipments of
approximately 4.30 billion units, compared to 4.66 billion units
for the six months ended June 30, 2020.
According to data from Management Science Associates, for the
second quarter of 2021, Liggett’s retail market share declined to
4.09% compared to 4.31% for the second quarter of 2020. For the six
months ended June 30, 2021, Liggett’s retail market share declined
to 4.13%, compared to 4.29% for the six months ended June 30, 2020.
Compared to the second quarter of 2020, Liggett’s retail shipments
in the second quarter of 2021 declined by 7.0% while the overall
industry’s retail shipments declined by 2.1%. Compared to the six
months ended June 30, 2020, Liggett’s retail shipments for six
months ended June 30, 2021 declined by 6.4% while the overall
industry’s retail shipments declined by 2.7%.
Real Estate Segment Financial Results
For the second quarter of 2021, the Real Estate segment had
revenues of $400.0 million compared to $133.3 million for the
second quarter of 2020. For the six months ended June 30, 2021, the
Real Estate segment had revenues of $675.3 million, compared to
$300.7 million for the six months ended June 30, 2020. For the last
twelve months ended June 30, 2021, the Real Estate segment had
revenues of $1.17 billion. For the second quarter of 2021, the Real
Estate segment reported net income of $39.4 million, compared to a
net loss of $12.4 million for the second quarter of 2020. For the
six months ended June 30, 2021, the Real Estate segment reported
net income of $51.5 million, compared to a net loss of $66.8
million for the six months ended June 30, 2020.
Douglas Elliman’s results are included in the Company’s Real
Estate segment. For the second quarter of 2021, Douglas Elliman had
revenues of $392.0 million, compared to $132.9 million for the
second quarter of 2020. For the six months ended June 30, 2021,
Douglas Elliman had revenues of $664.8 million, compared to $298.5
million for the six months ended June 30, 2020. For the last twelve
months ended June 30, 2021, Douglas Elliman had revenues of $1.14
billion. For the second quarter of 2021, Douglas Elliman reported
net income of $43.2 million, compared to a net loss of $5.0 million
for the second quarter of 2020. For the six months ended June 30,
2021, Douglas Elliman reported net income of $57.1 million,
compared to a net loss of $74.1 million for the six months ended
June 30, 2020.
Results for the second quarter of 2020 for the Real Estate
segment and Douglas Elliman included pre-tax restructuring charges
of $3.0 million and the Real Estate segment’s and Douglas Elliman’s
net loss for the six months ended June 30, 2020 included pre-tax
and non-cash impairment charges of $58.3 million and pre-tax
restructuring charges of $3.0 million.
Non-GAAP Financial Measures
For the second quarter of 2021, Real Estate Adjusted EBITDA
attributed to Vector (as described in Table 6 attached hereto) were
$44.6 million, compared to a loss of $1.7 million for the second
quarter of 2020.
For the six months ended June 30, 2021, Real Estate Adjusted
EBITDA attributed to Vector were $62.1 million, compared to a loss
of $8.6 million for the six months ended June 30, 2020.
For the last twelve months ended June 30, 2021, Real Estate net
income was $42.4 million and Real Estate Adjusted EBITDA were $92.5
million.
For the second quarter of 2021, Douglas Elliman’s Adjusted
EBITDA (as described in Table 7 attached hereto) were $45.3
million, compared to a loss of $1.1 million for the second quarter
of 2020.
For the six months ended June 30, 2021, Douglas Elliman’s
Adjusted EBITDA were $61.6 million, compared to a loss of $8.8
million for the six months ended June 30, 2020.
For the last twelve months ended June 30, 2021, Douglas
Elliman’s net income was $83.0 million and Douglas Elliman’s
Adjusted EBITDA were $92.4 million.
For the three and six months ended June 30, 2021, Douglas
Elliman achieved closed sales of approximately $14.5 billion and
$24.6 billion, respectively, compared to $4.7 billion and $10.8
billion for the three and six months ended June 30, 2020,
respectively. For the last twelve months ended June 30, 2021 and
the year ended December 31, 2020, Douglas Elliman achieved closed
sales of approximately $42.9 billion and $29.1 billion,
respectively.
Non-GAAP Financial Measures
Adjusted EBITDA, Adjusted Net Income, Adjusted Operating Income,
Tobacco Adjusted Operating Income, Tobacco Adjusted EBITDA, New
Valley Adjusted EBITDA, Douglas Elliman Adjusted EBITDA and
financial measures for the last twelve months (“LTM”) ended June
30, 2021 (“the Non-GAAP Financial Measures”) are financial measures
not prepared in accordance with generally accepted accounting
principles (“GAAP”). The Company believes that the Non-GAAP
Financial Measures are important measures that supplement
discussions and analysis of its results of operations and enhances
an understanding of its operating performance. The Company believes
the Non-GAAP Financial Measures provide investors and analysts with
a useful measure of operating results unaffected by differences in
capital structures and ages of related assets among otherwise
comparable companies.
Management uses the Non-GAAP Financial Measures 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 (the
Non-GAAP Financial Measures) of the Company’s business. While
management considers the Non-GAAP Financial Measures 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, the
Non-GAAP Financial Measures are susceptible to varying calculations
and the Company’s measurement of the Non-GAAP Financial Measures
may not be comparable to those of other companies. Attached hereto
as Tables 2 through 8 is information relating to the Company’s
Non-GAAP Financial Measures for the last twelve months ended June
30, 2021 and the three and six months ended June 30, 2021 and
2020.
Conference Call to Discuss Second Quarter 2021
Results
As previously announced, the Company will host a conference call
and webcast on Thursday, August 5, 2021 at 8:30 AM (ET) to discuss
its second quarter 2021 results. Investors can access the call by
dialing 877-271-1828 and entering 18383182 as the conference ID
number. The call will also be available via live webcast at
https://www.webcaster4.com/Webcast/Page/2271/42138. 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 August 5, 2021 through August 19, 2021. To access the
replay, dial 877-656-8905 and enter 18383182 as the conference ID
number. The archived webcast will also be available at
https://www.webcaster4.com/Webcast/Page/2271/42138 for one
year.
About Vector Group Ltd.
Vector Group is a holding company for Liggett Group LLC, Vector
Tobacco Inc., New Valley LLC, and Douglas Elliman Realty, LLC.
Additional information concerning the Company is available on the
Company’s website, www.VectorGroupLtd.com.
Investors and others should note that we may post information
about the Company or its subsidiaries on our website at
www.VectorGroupLtd.com and/or at the websites of those subsidiaries
or, if applicable, on their accounts on Facebook, Instagram,
LinkedIn, TikTok, Twitter, YouTube or other social media platforms.
It is possible that the postings or releases could include
information deemed to be material information. Therefore, we
encourage investors, the media and others interested in the Company
to review the information we post on our website at
www.VectorGroupLtd.com, on the websites of our subsidiaries and on
their social media accounts.
Forward-Looking and Cautionary Statements
This press release includes forward-looking statements within
the meaning of the federal securities law. All statements other
than statements of historical or current facts, including
statements regarding the current or anticipated impact of the
COVID-19 pandemic on our business, made in this document are
forward-looking. We identify forward-looking statements in this
document by using words or phrases such as “anticipate,” “believe,”
“estimate,” “expect,” “intend,” “may be,” “continue’” “could,”
“potential,” “objective,” “plan,” “seek,” “predict,” “project” and
“will be” and similar words or phrases or their negatives.
Forward-looking statements reflect our current expectations and are
inherently uncertain. Actual results could differ materially for a
variety of reasons. In particular, the extent, duration and
severity of the spread of the COVID-19 pandemic and economic
consequences stemming from the COVID-19 crisis (including a
potential significant economic contraction) as well as related
risks and the impact of any of the foregoing on our business,
results of operations and liquidity could affect our future results
and cause actual results to differ materially from those expressed
in forward-looking statements.
Risks and uncertainties that could cause our actual results to
differ significantly from our current expectations are described in
our 2020 Annual Report on Form 10-K and in our Quarterly Report on
Form 10-Q for the quarter ended June 30, 2021. We undertake no
responsibility to publicly update or revise any forward-looking
statement except as required by applicable law.
[Financial Tables Follow]
TABLE 1
VECTOR GROUP LTD. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Dollars
in Thousands, Except Per Share Amounts)
Three Months Ended
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
(Unaudited)
(Unaudited)
Revenues:
Tobacco*
$
329,496
$
312,510
$
597,959
$
599,579
Real estate
400,033
133,250
675,334
300,669
Total revenues
729,529
445,760
1,273,293
900,248
Expenses:
Cost of sales:
Tobacco*
206,145
214,067
370,176
411,357
Real estate
294,265
90,818
493,776
204,151
Total cost of sales
500,410
304,885
863,952
615,508
Operating, selling, administrative and
general expenses
92,043
71,064
182,057
161,581
Litigation settlement and judgment
expense
—
53
5
53
Impairments of goodwill and other
intangible assets
—
—
—
58,252
Restructuring charges
—
2,961
—
2,961
Operating income
137,076
66,797
227,279
61,893
Other income (expenses):
Interest expense
(28,115
)
(29,358
)
(56,866
)
(64,985
)
Loss on extinguishment of debt
—
—
(21,362
)
—
Change in fair value of derivatives
embedded within convertible debt
—
1,669
—
4,999
Equity in earnings from investments
941
2,207
1,518
52,359
Equity in earnings (losses) from real
estate ventures
16,685
(12,260
)
18,274
(18,765
)
Other, net
5,578
7,635
8,332
(3,020
)
Income before provision for income
taxes
132,165
36,690
177,175
32,481
Income tax expense
38,860
10,916
51,913
9,938
Net income
93,305
25,774
125,262
22,543
Net loss (income) attributed to
non-controlling interest
—
—
—
—
Net income attributed to Vector Group
Ltd.
$
93,305
$
25,774
$
125,262
$
22,543
Per basic common share:
Net income applicable to common share
attributed to Vector Group Ltd.
$
0.61
$
0.17
$
0.81
$
0.14
Per diluted common share:
Net income applicable to common share
attributed to Vector Group Ltd.
$
0.61
$
0.16
$
0.81
$
0.14
* Revenues and cost of sales include
federal excise taxes of $118,735, $121,170, $216,449 and $234,309
for the three and six months ended June 30, 2021 and 2020,
respectively.
TABLE 2
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF ADJUSTED
EBITDA
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
2021
2020
Net income attributed to Vector Group
Ltd.
$
195,657
$
92,938
$
93,305
$
25,774
$
125,262
$
22,543
Interest expense
113,422
121,541
28,115
29,358
56,866
64,985
Income tax expense
83,752
41,777
38,860
10,916
51,913
9,938
Depreciation and amortization
16,910
17,629
4,089
4,412
8,268
8,987
EBITDA
$
409,741
$
273,885
$
164,369
$
70,460
$
242,309
$
106,453
Change in fair value of derivatives
embedded within convertible debt (a)
—
(4,999
)
—
(1,669
)
—
(4,999
)
Equity in earnings from investments
(b)
(5,427
)
(56,268
)
(941
)
(2,207
)
(1,518
)
(52,359
)
Equity in losses (earnings) from real
estate ventures (c)
7,659
44,698
(16,685
)
12,260
(18,274
)
18,765
Loss on extinguishment of debt
21,362
—
—
—
21,362
—
Stock-based compensation expense (d)
10,682
9,483
3,080
2,283
5,740
4,541
Litigation settlement and judgment expense
(e)
289
337
—
53
5
53
Impact of MSA settlement (f)
(2,423
)
299
—
—
(2,722
)
—
Restructuring charges (g)
421
3,382
—
2,961
—
2,961
Net gains on sales of assets
(1,114
)
(1,114
)
—
—
—
—
Impairments of goodwill and other
intangible assets (h)
—
58,252
—
—
—
58,252
Other, net
(5,896
)
5,456
(5,578
)
(7,635
)
(8,332
)
3,020
Adjusted EBITDA attributed to Vector Group
Ltd.
$
435,294
$
333,411
$
144,245
$
76,506
$
238,570
$
136,687
Adjusted EBITDA Attributed to Vector
Group Ltd. by Segment
Tobacco
$
360,989
$
328,049
$
104,885
$
81,362
$
185,530
$
152,590
Real Estate (i)
92,478
21,782
44,588
(1,716
)
62,070
(8,626
)
Corporate and Other
(18,173
)
(16,420
)
(5,228
)
(3,140
)
(9,030
)
(7,277
)
Total
$
435,294
$
333,411
$
144,245
$
76,506
$
238,570
$
136,687
__________________
- Represents income recognized from changes in the fair value of
the derivatives embedded in the Company’s convertible debt.
- Represents equity in earnings recognized from investments that
the Company accounts for under the equity method. Included in the
amount are equity in earnings from Ladenburg Thalmann Financial
Services of $372 for the last twelve months ended June 30, 2021,
$53,424 for the year ended December 31, 2020, and $53,052 for the
six months ended June 30, 2020.
- Represents equity in losses (earnings) recognized from the
Company’s investment in certain real estate businesses that are
accounted for under the equity method and are not consolidated in
the Company’s financial results.
- Represents amortization of stock-based compensation.
- Represents accruals for product liability litigation in the
Company’s Tobacco segment.
- Represents the Company’s Tobacco segment’s settlement of
long-standing disputes related to the Master Settlement
Agreement.
- Represents restructuring charges related to Douglas Elliman
Realty, LLC’s realignment of administrative support functions,
office locations and business model.
- Represents non-cash intangible asset impairment charges in the
Company’s Real Estate segment related to the goodwill and trademark
of the Douglas Elliman Realty, LLC reporting unit.
- Includes Adjusted EBITDA for Douglas Elliman Realty, LLC of
$92,443 for the last twelve months ended June 30, 2021, $22,054 for
the year ended December 31, 2020, $45,280, loss of $1,054, $61,631
and loss of $8,758 for the three and six months ended June 30, 2021
and 2020, respectively.
TABLE 3
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF ADJUSTED NET
INCOME
(Unaudited)
(Dollars
in Thousands, Except Per Share Amounts)
Three Months Ended
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
Net income attributed to Vector Group
Ltd.
$
93,305
$
25,774
$
125,262
$
22,543
Change in fair value of derivatives
embedded within convertible debt
—
(1,669
)
—
(4,999
)
Non-cash amortization of debt discount on
convertible debt
—
759
—
5,276
Loss on extinguishment of debt
—
—
21,362
—
Litigation settlement and judgment expense
(a)
—
53
5
53
Impact of MSA settlement (b)
—
—
(2,722
)
—
Impact of net interest expense capitalized
to real estate ventures
(559
)
1,531
(869
)
3,050
Adjustment for derivative associated with
acquisition of 29.41% of Douglas Elliman Realty, LLC
3,595
234
3,523
(1,831
)
Restructuring charges (c)
—
2,961
—
2,961
Impairments of goodwill and other
intangible assets (d)
—
—
—
58,252
Total adjustments
3,036
3,869
21,299
62,762
Tax benefit (expense) related to
adjustments
151
(981
)
(4,798
)
(16,694
)
Adjusted Net Income attributed to Vector
Group Ltd.
$
96,492
$
28,662
$
141,763
$
68,611
Per diluted common share:
Adjusted Net Income applicable to common
shares attributed to Vector Group Ltd.
$
0.63
$
0.19
$
0.92
$
0.45
__________________
- Represents accruals for product liability litigation in the
Company’s Tobacco segment.
- Represents the Company’s Tobacco segment’s settlement of
long-standing disputes related to the Master Settlement
Agreement.
- Represents restructuring charges related to Douglas Elliman
Realty, LLC’s realignment of administrative support functions,
office locations and business model.
- Represents non-cash intangible asset impairment charges in the
Company’s Real Estate segment related to the goodwill and trademark
of the Douglas Elliman Realty, LLC reporting unit.
TABLE 4
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF ADJUSTED
OPERATING INCOME
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
2021
2020
Operating income
$
410,529
$
245,143
$
137,076
$
66,797
$
227,279
$
61,893
Litigation settlement and judgment expense
(a)
289
337
—
53
5
53
Restructuring charges (b)
421
3,382
—
2,961
—
2,961
Impact of MSA settlement (c)
(2,423
)
299
—
—
(2,722
)
—
Net gains on sales of assets
(1,114
)
(1,114
)
—
—
—
—
Impairments of goodwill and other
intangible assets (d)
—
58,252
—
—
—
58,252
Total adjustments
(2,827
)
61,156
—
3,014
(2,717
)
61,266
Adjusted Operating Income
$
407,702
$
306,299
$
137,076
$
69,811
$
224,562
$
123,159
__________________
- Represents accruals for product liability litigation in the
Company’s Tobacco segment.
- Represents restructuring charges related to Douglas Elliman
Realty, LLC’s realignment of administrative support functions,
office locations and business model.
- Represents the Company’s Tobacco segment’s settlement of
long-standing disputes related to the Master Settlement
Agreement.
- Represents non-cash intangible asset impairment charges in the
Company’s Real Estate segment related to the goodwill and trademark
of the Douglas Elliman Realty, LLC reporting unit.
TABLE 5
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF TOBACCO
ADJUSTED OPERATING INCOME
AND TOBACCO ADJUSTED
EBITDA
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
2021
2020
Tobacco Adjusted Operating
Income:
Operating income from Tobacco segment
$
355,819
$
319,536
$
103,179
$
79,309
$
184,778
$
148,495
Litigation settlement and judgment expense
(a)
289
337
—
53
5
53
Impact of MSA settlement (b)
(2,423
)
299
—
—
(2,722
)
—
Total adjustments
(2,134
)
636
—
53
(2,717
)
53
Tobacco Adjusted Operating Income
$
353,685
$
320,172
$
103,179
$
79,362
$
182,061
$
148,548
LTM
Year Ended
Three Months Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
2021
2020
Tobacco Adjusted EBITDA:
Operating income from Tobacco segment
$
355,819
$
319,536
$
103,179
$
79,309
$
184,778
$
148,495
Litigation settlement and judgment expense
(a)
289
337
—
53
5
53
Impact of MSA settlement (b)
(2,423
)
299
—
—
(2,722
)
—
Total adjustments
(2,134
)
636
—
53
(2,717
)
53
Tobacco Adjusted Operating Income
353,685
320,172
103,179
79,362
182,061
148,548
Depreciation and amortization
7,292
7,877
1,697
2,000
3,457
4,042
Stock-based compensation expense
12
—
9
—
12
—
Total adjustments
7,304
7,877
1,706
2,000
3,469
4,042
Tobacco Adjusted EBITDA
$
360,989
$
328,049
$
104,885
$
81,362
$
185,530
$
152,590
__________________
- Represents accruals for product liability litigation in the
Company’s Tobacco segment.
- Represents the Company’s Tobacco segment’s settlement of
long-standing disputes related to the Master Settlement
Agreement.
TABLE 6
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF REAL ESTATE
SEGMENT (NEW VALLEY LLC) ADJUSTED EBITDA
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
2021
2020
Net income (loss) attributed to Vector
Group Ltd. from subsidiary non-guarantors (a)
$
42,403
$
(75,910
)
$
39,398
$
(12,417
)
$
51,464
$
(66,849
)
Interest expense (a)
121
268
44
106
75
222
Income tax expense (benefit) (a)
17,879
(27,674
)
16,508
(4,529
)
21,215
(24,338
)
Depreciation and amortization
9,139
8,874
2,374
2,198
4,776
4,511
EBITDA
$
69,542
$
(94,442
)
$
58,324
$
(14,642
)
$
77,530
$
(86,454
)
(Income) loss from non-guarantors other
than New Valley LLC
(332
)
45
(174
)
15
(333
)
44
Equity in losses (earnings) from real
estate ventures (b)
7,659
44,698
(16,685
)
12,260
(18,274
)
18,765
Restructuring charges (c)
421
3,382
—
2,961
—
2,961
Loss on sale of asset
1,169
1,169
—
—
—
—
Impairments of goodwill and other
intangible assets (d)
—
58,252
—
—
—
58,252
Other, net
13,982
8,575
3,121
(2,325
)
3,125
(2,282
)
Adjusted EBITDA attributed to New Valley
LLC
$
92,441
$
21,679
$
44,586
$
(1,731
)
$
62,048
$
(8,714
)
Adjusted EBITDA Attributed to New Valley
LLC by Segment
Real Estate (e)
$
92,478
$
21,782
$
44,588
$
(1,716
)
$
62,070
$
(8,626
)
Corporate and Other
(37
)
(103
)
(2
)
(15
)
(22
)
(88
)
Total (f)
$
92,441
$
21,679
$
44,586
$
(1,731
)
$
62,048
$
(8,714
)
__________________
- Amounts are derived from Vector Group Ltd.’s Condensed
Consolidated Financial Statements. See Exhibit 99.2 “Condensed
Consolidating Financial Information” contained in Vector Group
Ltd.’s Form 10-K for the period ended December 31, 2020, Form 10-Q
for the period ended June 30, 2021 and Note 14 contained in Vector
Group Ltd.’s Form 10-Q for the period ended June 30, 2020.
- Represents equity in losses (earnings) recognized from the
Company’s investment in certain real estate businesses that are
accounted for under the equity method and are not consolidated in
the Company’s financial results.
- Represents restructuring charges related to Douglas Elliman
Realty, LLC’s realignment of administrative support functions,
office locations and business model.
- Represents non-cash intangible asset impairment charges in the
Company’s Real Estate segment related to the goodwill and trademark
of the Douglas Elliman Realty, LLC reporting unit.
- Includes Adjusted EBITDA for Douglas Elliman Realty, LLC of
$92,443 for the last twelve months ended June 30, 2021, $22,054 for
the year ended December 31, 2020, $45,280, loss of $1,054, $61,631
and loss of $8,758 for the three and six months ended June 30, 2021
and 2020, respectively.
- New Valley’s Adjusted EBITDA does not include an allocation of
Vector Group Ltd.’s “Corporate and Other” segment expenses (for
purposes of computing Adjusted EBITDA contained in Table 2 of this
press release) of $18,173 for the last twelve months ended June 30,
2021, $16,420 for the year ended December 31, 2020, $5,228, $3,140,
$9,030 and $7,277 for the three and six months ended June 30, 2021
and 2020, respectively.
TABLE 7
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF DOUGLAS
ELLIMAN REALTY, LLC ADJUSTED EBITDA
ATTRIBUTED TO REAL ESTATE
SEGMENT
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
2021
2020
Net income (loss) attributed to Douglas
Elliman Realty, LLC
$
82,956
$
(48,210
)
$
43,160
$
(5,042
)
$
57,084
$
(74,082
)
Interest expense
3
1
1
—
3
1
Income tax expense (benefit)
826
(5
)
590
2
833
2
Depreciation and amortization
8,445
8,537
2,097
2,089
4,220
4,312
Douglas Elliman Realty, LLC EBITDA
$
92,230
$
(39,677
)
$
45,848
$
(2,951
)
$
62,140
$
(69,767
)
Equity in earnings from real estate
ventures (a)
(82
)
(30
)
(75
)
—
(75
)
(23
)
Restructuring charges (b)
421
3,382
—
2,961
—
2,961
Loss on sale of asset
1,169
1,169
—
—
—
—
Impairments of goodwill and other
intangible assets (c)
—
58,252
—
—
—
58,252
Other, net
(1,295
)
(1,042
)
(493
)
(1,064
)
(434
)
(181
)
Douglas Elliman Realty, LLC Adjusted
EBITDA attributed to Real Estate Segment
$
92,443
$
22,054
$
45,280
$
(1,054
)
$
61,631
$
(8,758
)
__________________
- Represents equity in earnings recognized from the Company’s
investment in certain real estate businesses that are accounted for
under the equity method and are not consolidated in the Company’s
financial results.
- Represents restructuring charges related to Douglas Elliman
Realty, LLC’s realignment of administrative support functions,
office locations and business model.
- Represents non-cash intangible asset impairment charges related
to the goodwill and trademark of Douglas Elliman Realty, LLC.
TABLE 8
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF
REVENUES
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Six Months Ended
June 30,
December 31,
June 30,
June 30,
2021
2020
2021
2020
Revenues:
Tobacco (a)
$
1,202,881
$
1,204,501
$
597,959
$
599,579
Real estate (b)
1,172,833
798,168
675,334
300,669
Total revenues
$
2,375,714
$
2,002,669
$
1,273,293
$
900,248
__________________
- Tobacco segment revenues include federal excise taxes of
$443,672, $461,532, $216,449 and $234,309 for the last twelve
months ended June 30, 2021, the year ended December 31, 2020 and
the six months ended June 30, 2021 and 2020, respectively.
- Real Estate segment revenues include revenues from Douglas
Elliman of $1,140,208, $773,987, $664,751 and $298,530 for the last
twelve months ended June 30, 2021, the year ended December 31, 2020
and the six months ended June 30, 2021 and 2020, respectively.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210804006131/en/
Emily Claffey/Benjamin Spicehandler/Columbia Clancy Sard
Verbinnen & Co 212-687-8080 Eve Young
Sard Verbinnen & Co - Europe +44 (0)20 3178 8914 J. Bryant
Kirkland III, Vector Group Ltd. 305-579-8000
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