Bloomberg News

Prologis Reports Fourth-Quarter FFO of $134.1 Million on Merger

February 09, 2012

Feb. 8 (Bloomberg) -- Prologis Inc., the world’s largest warehouse owner, reported fourth-quarter funds from operations of $134.1 million as leasing increased after the company’s merger with AMB Property Corp.

FFO, which gauges a property owner’s ability to generate cash, was 29 cents a share in the second quarter of results since the merger, San Francisco-based Prologis said today in a statement. The year-earlier figure, which reflects the legacy company, was a loss of 1.15 billion, or $4.81 a share.

Prologis and AMB combined in June in the biggest merger of U.S. real estate investment trusts. The company is selling properties in smaller markets and areas less important to global trade while increasing its real estate fund management business.

“The progress they’ve made in the past few quarters has been pretty impressive,” Craig Guttenplan, an analyst at CreditSights Inc. in London, said by telephone before the results were announced. “There’s a pretty good bid for industrial property out there.”

Fourth-quarter FFO included items including costs relating to the merger. Excluding those items, so-called core FFO climbed to $203.9 million, or 44 cents a share, from $99.4 million or 41 cents, a year earlier. Prologis estimated in October that fourth-quarter core FFO would be 39 cents to 41 cents a share, and analysts expected FFO of 40 cents, the average of 14 estimates in a Bloomberg survey.

The company had a net loss of $45.5 million in the quarter, compared with a $1.17 billion loss a year earlier. The differential between core FFO and FFO in the fourth quarter Of 2011 primarily relates to impairment charges and merger costs.

Prologis released the results before the start of regular U.S. trading. The stock has risen 31 percent in the last six months, compared with a 30 percent gain in the Bloomberg REIT Index.

(Prologis will hold a conference call at 12 p.m. New York time. See {PLD US <Equity> EVT <GO>}.)

--Editors: Daniel Taub, Ross Larsen.

To contact the reporter on this story: Brian Louis in Chicago at blouis1@bloomberg.net.

To contact the editor responsible for this story: Daniel Taub at dtaub@bloomberg.net.


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