By Everdeen Mason
Prologis Inc. (PLD) swung to a fourth-quarter profit, as gains
from asset dispositions offset a drop in revenue, while core funds
from operations edged higher.
The warehouse real-estate investment trust completed $1.8
billion in contributions and dispositions of buildings and land in
the fourth quarter, which the company said was the main reason for
the rise in earnings.
For 2014, the company gave an adjusted per-share estimate for
funds from operations--a key measure of performance for REITs--of
$1.74 to $1.82. Analysts polled by Thomson Reuters recently
expected per-share adjusted FFO of $1.76.
The current Prologis was formed in June 2011, when the nation's
two biggest publicly traded warehouse owners--Prologis and AMB
Property Corp.--merged in one of the largest real-estate deals
since the recession.
The San Francisco-based real-estate investment trust has
continued to benefit from a rental rebound that has raised
occupancy rates and profits on its U.S. warehouses.
Prologis reported a profit of $61.2 million, compared with a
year-earlier loss of $218.4 million. On a per-share basis, which
reflects preferred-stock impacts, the profit was 12 cents, compared
with a year-earlier loss of 50 cents.
The latest reporting period also included a net $112.9 million
in early-debt extinguishment losses.
Revenue fell 14% to $436.8 million. Rental revenue dropped 19%
to $379.2 million.
Core funds from operations, which excludes items such as gains
and losses from property acquisitions or dispositions, ticked up to
43 cents a share from 42 cents.
Analysts polled by Thomson Reuters recently expected per-share
FFO of 42 cents and rental revenue of $387.2 million.
As of the end of the quarter, the occupancy rate was 95.1%, up
from 94% reported a year earlier. Tenant retention was 86.8% and
rental rates on leases signed during the quarter were 5.9% higher
than prior rents.
The company's shares closed Wednesday at $37.01 and were
inactive in recent premarket trading Thursday. The stock is down
7.6% in the past 12 months.
Write to Everdeen Mason at everdeen.mason@wsj.com
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