10-KPeriod: FY2021

Prologis, Inc. Annual Report, Year Ended Dec 31, 2021

Filed February 9, 2022For Securities:PLDPLDGP

Summary

Prologis, Inc. (PLD) reported a strong year in 2021, driven by robust demand for logistics real estate, fueled by the continued growth of e-commerce and supply chain repositioning. The company maintained high occupancy rates across its extensive global portfolio, which spans 19 countries. Prologis highlighted its ability to generate significant value through development projects and its strategic capital business, which involves managing co-investment ventures. Financially, the company focused on strengthening its balance sheet by refinancing debt at favorable rates, extending maturities, and maintaining substantial liquidity, positioning it well for future growth opportunities. The company's strategic focus remains on capitalizing on its scale and customer relationships through its Prologis Essentials business, offering solutions that enhance customer operations and sustainability. Prologis is also investing in future logistics trends, such as electric vehicle fleets. The report indicates confidence in continued rent growth and value creation from its development pipeline, supported by a strong leasing environment.

Financial Highlights

39 data points
Beta

Revenue

$4.76B

Net Income

$2.93B

61.6% Net Margin

EPS (Diluted)

$3.94

Total Assets

$58.49B

Cash & Equivalents

$556.00M

Free Cash Flow

$3.00B

Financial Statements
Beta
Revenue$4.76B
Operating Income$3.21B
Interest Expense$266.23M
Net Income$2.93B
EPS (Basic)$3.97
EPS (Diluted)$3.94
Shares Outstanding (Basic)739.36M
Shares Outstanding (Diluted)764.76M

Key Highlights

  • 1Robust demand for logistics real estate driven by e-commerce growth and supply chain optimization.
  • 2High occupancy rates (97.7% on O&M portfolio at year-end 2021) demonstrating strong market demand.
  • 3Significant value creation from development activities, with a land bank projected to support $22.2 billion in future development.
  • 4Strengthened balance sheet with extended debt maturities (average remaining maturity of 10 years) and lower interest rates (weighted average effective interest rate of 1.6%).
  • 5Total available liquidity of $5.0 billion at December 31, 2021, providing ample capacity for investments and operations.
  • 6Strategic Capital segment generating recurring fee streams, with asset management fees driven by increasing portfolio valuations.
  • 7Commitment to sustainability, including a goal of 100% carbon-neutral construction globally by 2025 and investments in EV charging infrastructure.

Frequently Asked Questions

Prologis expects rents to continue increasing due to strong demand and the quality/location of its properties. The company estimates a net effective lease mark-to-market of approximately 36%, indicating significant upside potential from in-place leases to market rents.

Prologis has actively refinanced its debt, lowering its weighted average effective interest rate to 1.6% and extending the weighted average remaining maturity to 10 years by December 31, 2021. The company maintains strong credit ratings and significant liquidity, providing financial flexibility.

Prologis's growth strategy is multi-faceted, including driving rent growth on its existing portfolio, creating value through development and redevelopment of its land bank, leveraging its Strategic Capital business to generate fee streams, and focusing on customer relationships and value-added solutions through its Prologis Essentials business. They also emphasize innovation, digitization, and sustainability.

Prologis has a strong commitment to ESG, focusing on developing energy-efficient buildings, implementing solar power and LED lighting, and assisting customers with their sustainability goals. They have set ambitious targets, including achieving 100% carbon-neutral construction globally by 2025 and investing in EV charging infrastructure to support the future of logistics.