Highwoods Properties(HIW) - 2019 Q3 - Quarterly Report

PART I - FINANCIAL INFORMATION ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) This section presents the unaudited condensed consolidated financial statements for Highwoods Properties, Inc. and Highwoods Realty Limited Partnership, including balance sheets, income statements, comprehensive income statements, equity/capital statements, and cash flow statements for the periods ended September 30, 2019, and December 31, 2018 (for balance sheets) or September 30, 2018 (for income/cash flow statements), along with detailed notes explaining significant accounting policies, lease accounting changes, variable interest entities, real estate asset activities, intangible assets, debt, derivatives, noncontrolling interests, fair value disclosures, share-based payments, comprehensive income components, earnings per share/unit, segment information, and subsequent events HIGHWOODS PROPERTIES, INC. Consolidated Balance Sheets This section provides a snapshot of the Company's financial position, detailing assets, liabilities, and stockholders' equity at specific reporting dates | Metric | Sep 30, 2019 (in thousands) | Dec 31, 2018 (in thousands) | | :--------------------------------- | :-------------------------- | :-------------------------- | | Total Assets | $4,890,625 | $4,675,009 | | Total Liabilities | $2,595,215 | $2,304,753 | | Total Stockholders' Equity | $2,150,662 | $2,246,720 | - Cash and cash equivalents significantly increased from $3,769 thousand at December 31, 2018, to $116,724 thousand at September 30, 2019[18] HIGHWOODS PROPERTIES, INC. Consolidated Statements of Income This section outlines the Company's financial performance over specific periods, detailing revenues, expenses, and net income | Metric | Three Months Ended Sep 30, 2019 (in thousands) | Three Months Ended Sep 30, 2018 (in thousands) | Nine Months Ended Sep 30, 2019 (in thousands) | Nine Months Ended Sep 30, 2018 (in thousands) | | :--------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Rental and other revenues | $187,475 | $179,417 | $543,908 | $538,647 | | Total operating expenses | $142,020 | $128,365 | $414,265 | $383,040 | | Net income | $29,557 | $35,009 | $79,337 | $122,253 | | Net income available for common stockholders | $27,901 | $33,160 | $74,578 | $116,295 | | Basic EPS | $0.27 | $0.32 | $0.72 | $1.12 | | Diluted EPS | $0.27 | $0.32 | $0.72 | $1.12 | - Net income available for common stockholders decreased by $5,259 thousand (15.86%) for the three months ended September 30, 2019, compared to the same period in 2018, and by $41,717 thousand (35.87%) for the nine months ended September 30, 2019, compared to the same period in 2018[20] - Impairments of real estate assets of $5,318 thousand were recorded in Q3 2019 and $5,849 thousand YTD 2019, with no comparable impairments in 2018[20] HIGHWOODS PROPERTIES, INC. Consolidated Statements of Comprehensive Income This section details the Company's comprehensive income, including net income and other comprehensive income or loss components | Metric | Three Months Ended Sep 30, 2019 (in thousands) | Three Months Ended Sep 30, 2018 (in thousands) | Nine Months Ended Sep 30, 2019 (in thousands) | Nine Months Ended Sep 30, 2018 (in thousands) | | :--------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net income | $29,557 | $35,009 | $79,337 | $122,253 | | Total other comprehensive income/(loss) | $(7,015) | $1,533 | $(10,440) | $9,651 | | Total comprehensive income | $22,542 | $36,542 | $68,897 | $131,904 | - Total other comprehensive income/(loss) shifted from a gain of $1,533 thousand in Q3 2018 to a loss of $7,015 thousand in Q3 2019, primarily due to unrealized losses on cash flow hedges[23] HIGHWOODS PROPERTIES, INC. Consolidated Statements of Equity This section presents changes in the Company's stockholders' equity, including capital contributions, distributions, and comprehensive income adjustments | Metric | Sep 30, 2019 (in thousands) | Dec 31, 2018 (in thousands) | | :--------------------------------- | :-------------------------- | :-------------------------- | | Total Stockholders' Equity | $2,172,917 | $2,264,296 | | Additional paid-in capital | $2,963,680 | $2,976,197 | | Distributions in excess of net income available for common stockholders | $(842,387) | $(769,303) | | Accumulated other comprehensive income/(loss) | $(527) | $9,913 | - Total Stockholders' Equity decreased from $2,264,296 thousand at December 31, 2018, to $2,172,917 thousand at September 30, 2019[26][27] - Accumulated other comprehensive income/(loss) shifted from a positive balance of $9,913 thousand at December 31, 2018, to a negative balance of $(527) thousand at September 30, 2019[26][27] HIGHWOODS PROPERTIES, INC. Consolidated Statements of Cash Flows This section summarizes the Company's cash inflows and outflows from operating, investing, and financing activities over specific periods | Cash Flow Activity | Nine Months Ended Sep 30, 2019 (in thousands) | Nine Months Ended Sep 30, 2018 (in thousands) | | :--------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash provided by operating activities | $286,261 | $292,958 | | Net cash used in investing activities | $(250,260) | $(290,904) | | Net cash provided by/(used in) financing activities | $76,880 | $(78,108) | | Net increase/(decrease) in cash and cash equivalents and restricted cash | $112,881 | $(76,054) | - Net cash provided by operating activities slightly decreased by $6,697 thousand (2.29%) in the nine months ended September 30, 2019, compared to the same period in 2018[29] - Net cash used in investing activities decreased by $40,644 thousand (13.97%) in the nine months ended September 30, 2019, compared to the same period in 2018[29] - Financing activities shifted from using $78,108 thousand cash in 2018 to providing $76,880 thousand cash in 2019, a significant increase of $154,988 thousand[29] HIGHWOODS REALTY LIMITED PARTNERSHIP Consolidated Balance Sheets This section presents the balance sheet for Highwoods Realty Limited Partnership, reflecting its financial position as the primary operating entity | Metric | Sep 30, 2019 (in thousands) | Dec 31, 2018 (in thousands) | | :--------------------------------- | :-------------------------- | :-------------------------- | | Total Assets | $4,890,625 | $4,675,00