Summary
Public Storage (PSA) reported its third quarter 2009 results, showing a mixed financial performance influenced by the challenging economic environment. While net income saw a significant year-over-year increase due to favorable foreign currency exchange movements and gains from an equity offering in PS Business Parks, the core self-storage operations experienced declines in revenue and net operating income for both same-store and other facilities. This was primarily driven by lower rental rates and occupancy levels, reflecting broader economic pressures impacting demand. Despite these headwinds, the company maintained a strong liquidity position with substantial cash reserves and an undrawn credit facility, and continued its focus on efficient operations and strategic capital deployment, including opportunistic debt repurchases.
Financial Highlights
31 data points| Revenue | $412.09M |
| Interest Expense | $7.29M |
| Net Income | $237.31M |
| EPS (Basic) | $1.03 |
| EPS (Diluted) | $1.03 |
| Shares Outstanding (Basic) | 168.37M |
| Shares Outstanding (Diluted) | 169.04M |
Key Highlights
- 1Net income for Q3 2009 increased significantly year-over-year to $244 million, primarily boosted by a foreign currency exchange gain and a gain from PS Business Parks' equity offering, offsetting a decline in net operating income from self-storage facilities.
- 2Same-store rental revenues decreased by 4.6% year-over-year, reflecting a 4.2% decline in realized rent per occupied square foot and a 1.0% decrease in average occupancy.
- 3Net operating income for same-store facilities decreased by 6.3% year-over-year, indicating ongoing pressure on profitability within the core self-storage business.
- 4The company maintained a strong balance sheet with $670.9 million in cash and cash equivalents and an undrawn $300 million credit facility, providing significant financial flexibility.
- 5Public Storage repurchased approximately $110 million of its senior unsecured notes and significant portions of its preferred partnership units and preferred shares during the nine months ended September 30, 2009, at a discount, which is expected to reduce future dividend requirements.
- 6The company's European operations (Shurgard Europe), reported as equity in earnings, also showed mixed results with revenue declines, though improved slightly in the third quarter.
- 7The company continued to manage operating expenses effectively, with total cost of operations for same-store facilities decreasing by 0.6% year-over-year, demonstrating cost control measures.