10-QPeriod: Q2 FY2010

Prologis, Inc. Quarterly Report for Q2 Ended Jun 30, 2010

Filed August 3, 2010For Securities:PLDPLDGP

Summary

AMB Property Corporation (AMB) reported its second quarter 2010 financial results, showing a solid increase in revenues and a shift from a net loss in the prior year's comparable period to net income. The company experienced a 7.8% increase in total revenues, driven primarily by growth in rental revenues from its development portfolio and other industrial properties. While same-store NOI saw a slight decline due to lower occupancy and increased free rent concessions, the overall portfolio performance is showing signs of stabilization. Management highlighted the company's proactive debt management, including significant debt repayments and extensions, and a strengthened liquidity position with substantial availability under its credit facilities. The company also completed a significant equity offering in April 2010, bolstering its financial flexibility for future investments and operations.

Financial Highlights

23 data points
Beta

Net Income

-$16.78M

EPS (Diluted)

$-0.11

Cash & Equivalents

$37.63M

Free Cash Flow

$102.72M

Financial Statements
Beta
Operating Expenses$184.83M
Operating Income$32.13M
Interest Expense$118.92M
Net Income-$16.78M
EPS (Basic)$-0.11
EPS (Diluted)$-0.11

Key Highlights

  • 1Total revenues increased by 6.7% to $158.6 million for the three months ended June 30, 2010, compared to $148.6 million in the prior year period.
  • 2Net income available to common stockholders was $2.9 million, or $0.02 per diluted share, a significant improvement from a net loss of $97.0 million, or $(0.86) per diluted share, in the comparable prior year period.
  • 3Total assets grew to $7.1 billion as of June 30, 2010, from $6.8 billion at December 31, 2009, primarily driven by increases in investments in unconsolidated joint ventures and net investments in real estate.
  • 4Total debt was reduced to $3.0 billion from $3.2 billion during the six-month period, reflecting a commitment to deleveraging.
  • 5Occupancy for the owned and managed portfolio improved to 91.8% at June 30, 2010, from 90.1% at the end of the previous quarter.
  • 6The company raised approximately $479 million in net proceeds from an equity offering in April 2010, strengthening its liquidity and financial flexibility.
  • 7Despite a decline in same-store NOI, management noted positive net absorption in key port markets and anticipates an improvement in industrial absorption in the second half of the year.

Frequently Asked Questions

AMB Property Corporation reported a revenue increase of 6.7% to $158.6 million for the three months ended June 30, 2010. Crucially, the company swung from a net loss of $97.0 million in the prior year's second quarter to a net income of $2.9 million, or $0.02 per diluted share.

The company has actively managed its debt, reducing total debt by $218 million to $3.0 billion during the first half of 2010. Their liquidity position has been strengthened by an equity offering that generated approximately $479 million in net proceeds in April 2010, contributing to substantial availability under their credit facilities.

Management observes a gradual improvement in economic conditions, expecting an increase in demand for industrial real estate as inventory restocking takes hold. They anticipate positive net absorption in key port markets and a potential rebound in industrial absorption in the second half of the year, driven by moderate demand meeting record-low construction.

The occupancy rate for the owned and managed portfolio improved to 91.8% by June 30, 2010. The company leased approximately 7.9 million square feet in its global operating portfolio during the quarter, indicating active leasing efforts.