MAC Reports in Sync with Estimates - Analyst Blog
February 06 2012 - 3:30AM
Zacks
Macerich Co.
(MAC), a real estate investment trust (REIT), reported fourth
quarter 2011 FFO (fund from operations) of $118.8 million or 83
cents per share compared with $108.9 million or 77 cents per share
in the year-earlier quarter. Fund from operations, a widely used
metric to gauge the performance of REITs, is obtained after adding
depreciation and amortization and other non-cash expenses to net
income.
Adjusted FFO in the reported
quarter was $124.6 million or 87 cents per share versus $108.9
million or 77 cents in the year-ago quarter. FFO growth in the
fourth quarter was driven by strong fundamentals in the portfolio
with solid tenant sales growth and healthy occupancy levels.
Adjusted quarterly FFO per share was in line with the Zacks
Consensus Estimate.
For full year 2011, FFO was $399.6
million or $2.79 per share compared with $351.3 million or $2.66
per share in the previous year. Adjusted FFO in the reported fiscal
was $2.88 per share versus $2.66 in 2010. Adjusted fiscal 2011 FFO
per share was well ahead of the Zacks Consensus Estimate of
$2.58.
Total revenues during the quarter
were $217.8 million versus $203.9 million in the year-ago period.
For full year 2011, total revenues were $803.3 million versus
$758.6 million in 2010.
Overall same-store occupancy at
quarter-end was 92.7% compared to 91.9% in the previous quarter.
Mall tenant sales increased 12.9% in 2011 to $489 per square foot
compared with $433 in 2010.
During the reported quarter,
Simon Property Group Inc. (SPG) exchanged its 50%
ownership interests in six malls and one community center with
Macerich for their 50% ownership interests in five malls and one
community center. The transaction did not involve any cash
exchange, other than the customary net working capital adjustments.
As a result of the transaction, Simon owns 100% of Empire Mall,
Lindale Mall, Mesa Mall, Rushmore Mall, Southern Hills Mall and
Empire East, and Macerich fully owns Eastland Mall, Lake Square
Mall, Northpark Mall, South Ridge Mall, Southpark Mall, Valley Mall
and Eastland Convenience Center.
Macerich closed on a $140 million,
4.00% 10-year fixed rate loan on Pacific View Mall in Ventura,
California, during the quarter. Subsequent to the quarter-end, the
company closed on a $75 million, 10-year fixed rate loan
collateralized by La Encantada Center.
During the reported quarter,
Macerich executed a $125 million seven-year unsecured note at LIBOR
plus 2.20%. The company utilized the proceeds to pay down its line
of credit. For full-year 2012, Macerich expects FFO in the range of
$3.38 to $3.46 per share.
We maintain our long-term ‘Neutral’
recommendation on Macerich, which currently retains a Zacks #3 Rank
that translates into a short-term ‘Hold’ rating.
MACERICH CO (MAC): Free Stock Analysis Report
SIMON PROPERTY (SPG): Free Stock Analysis Report
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