Time to start focusing on these again
General Growth's profit rises on investment gain
By Maria Armental
Published: Jan 28, 2015 4:45 p.m. ET
General Growth Properties Inc.'s fourth-quarter profit rose sharply as the company recorded a $289 million investment gain.
The Chicago-based real-estate investment trust expects funds from operations of 30 cents to 32 cents a share for the current quarter and $1.35 to $1.41 a share for the year, compared with the Wall Street consensus of 32 cents and $1.44, respectively, according to analysts surveyed by Thomson Reuters.
FFO are a key metric for REITs that looks at the ratio of depreciation and amortization expenses to earnings.
General Growth, the nation's second-largest mall owner by number of properties, has been slimming operations and accelerating its redevelopment pipeline since exiting bankruptcy in 2010. General Growth has also been shifting focus to urban storefronts, betting luxury tenants are poised to grow faster outside of mall settings.
Tenant sales, which excludes sales at anchor stores, rose 2.8% to $20.5 billion, in the latest period from the year earlier. Same-store mall leased percentage was 97.2% at the end of the quarter, up 10 basis points from a year earlier, while initial rental rates for new leases in 2014 on a suite-to-suite basis rose 18.3% to $62.26 per square foot, compared to rates for expiring leases.
Overall, General Growth reported a profit of $289.5 million, or 30 cents a share, up from $77.2 million, or seven cents a share, a year earlier.
FFO rose to 38 cents a share from 36 cents a year earlier. General Growth had projected FFO of 37 cents to 39 cents a share.
Revenue rose 0.35% to $673 million, compared with the Wall Street consensus of $671.7 million in revenue.
Shares, which Wednesday set a 52-week high trading at $31.70, rose 0.87% in recent after-hours trading to $31.48.
Through Wednesday's closing, the company's stock had risen 59% over the past 12 months.
Write to Maria Armental at maria.armental@wsj.com
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