Public Storage 2012 Annual Report Download - page 64

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46
2012 as compared to 2011, and 2011 as compared to 2010, due primarily to lower average dividend rates on our
outstanding preferred securities. Based upon our preferred shares outstanding at December 31, 2012, and including
the Series W Preferred Shares which were issued on January 16, 2013, our quarterly distribution to our preferred
shareholders is expected to be approximately $49.0 million.
Net Operating Income
In our discussions above, we refer to net operating income or “NOI,” which is a non-GAAP (generally
accepted accounting principles) financial measure that excludes the impact of depreciation and amortization
expense. We believe that NOI is a meaningful measure of operating performance, because we utilize NOI in
making decisions with respect to capital allocations, in determining current property values, in evaluating property
performance and in comparing period-to-period and market-to-market property operating results. In addition, we
believe the investment community utilizes NOI in determining operating performance and real estate values, and
does not consider depreciation expense because it is based upon historical cost. NOI is not a substitute for net
income, net operating cash flow, or other related GAAP financial measures, in evaluating our operating results. The
following table reconciles NOI generated by our self-storage facilities to our net income:
Year Ended December 31,
2012 2011 2010
(Amounts in thousands)
Self-storage net operating income:
Same Store Facilities ............................................. $ 1,127,568 $ 1,045,014 $ 979,802
Non Same Store Facilities ..................................... 73,656 53,672 34,879
1,201,224 1,098,686 1,014,681
Self-storage depreciation expense:
Same Store Facilities ............................................. (313,173) (319,033) (316,199)
Non Same Store Facilities ..................................... (41,798) (36,282) (34,426)
(354,971) (355,315) (350,625)
Self-storage net income:
Same Store Facilities ............................................. 814,395 725,981 663,603
Non Same Store Facilities ..................................... 31,858 17,390 453
Total net income from self-storage .................. 846,253 743,371 664,056
Ancillary operating revenue ...................................... 123,639 114,089 104,381
Ancillary cost of operations ....................................... (38,263) (37,396) (33,689)
Commercial depreciation and amortization ............... (2,810) (2,654) (2,620)
General and administrative expense .......................... (56,837) (52,410) (38,487)
Asset impairment charges .......................................... - (2,186) (994)
Interest and other income .......................................... 22,074 32,333 29,017
Interest expense ......................................................... (19,813) (24,222) (30,225)
Equity in earnings of unconsolidated real estate
entities ................................................................
45,586
58,704
38,352
Foreign currency exchange gain (loss) ...................... 8,876 (7,287) (42,264)
Gain on real estate sales and debt retirement ............. 1,456 10,801 827
Discontinued operations ............................................ 12,874
3,316 7,760
Net income ............................................................. $ 943,035 $ 836,459 $ 696,114