Summary
AMB Property Corporation (the registrant, which later became Prologis, Inc. after a merger) reported its second quarter 2010 results. Key financial metrics show a decrease in Funds from Operations (FFO) as adjusted per share to $0.30 from $0.37 in the prior year's second quarter. Net income available to common stockholders also declined significantly to $0.02 per share from $0.12 year-over-year, primarily attributed to higher depreciation expenses and reduced gains from property dispositions. Despite the dip in profitability metrics, operational performance showed signs of recovery. Occupancy in the operating portfolio improved to 91.8% at the end of the quarter, up from 90.1% average occupancy during the quarter and up 130 basis points from the prior quarter. However, cash-basis same-store Net Operating Income (NOI) decreased by 6.0% year-over-year, impacted by lower average same-store occupancy and increased free rent. The company also reported significant leasing activity and strategic investment and disposition activities, including capital raises for its funds and debt reduction.
Key Highlights
- 1FFO as adjusted per share decreased to $0.30 in Q2 2010 from $0.37 in Q2 2009.
- 2Net income per diluted share declined to $0.02 in Q2 2010 from $0.12 in Q2 2009, driven by higher depreciation and lower property disposition gains.
- 3Portfolio occupancy improved to 91.8% at June 30, 2010, up from 90.1% average occupancy during Q2 2010.
- 4Cash-basis same-store NOI (excluding lease termination fees) decreased by 6.0% year-over-year, influenced by lower occupancy and increased free rent.
- 5The company completed $42.7 million in acquisitions and $35 million in dispositions during the quarter.
- 6Subsequent to the quarter end, the company secured $93.3 million in new third-party equity commitments for its US and European logistics funds.
- 7Total debt was reduced by approximately $264 million during the quarter, with debt-to-assets ratio improving to 40.5% from 44.8%.