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Third Quarter Results
The New Hyde Park, New York-based company posted FFO of $112.55 million or $0.30 per share, lower than $176.89 million or $0.68 per share in the prior-year quarter. On average, 18 analysts polled by Thomson Reuters expected the company to report earnings of $0.31 per share. Analysts' estimates typically exclude special items.
Excluding non-cash impairments and charges for the acceleration of deferred costs from early debt repayment, FFO for the quarter dropped to $117.9 million or $0.31 per share from $182.80 million or $0.70 per share in the year-ago quarter.
Net income available to common shareholders for the quarter totaled $28.29 million or $0.07 per share from $96.76 million or $0.37 per share in the comparable quarter a year ago.
Revenues from rental properties for the quarter edged up to $191.89 million from $189.95 million in the same quarter last year. Nine Wall Street analysts had a consensus revenue estimate of $187.77 million for the quarter.
Peer Performance
Among Kimco's peers, Indianapolis, Indiana-based Simon Property Group, Inc. (SPG | Quote | Chart | News | PowerRating) reported last week a 2% year-over-year increase in third quarter funds from operations to $473.07 million or $1.38 per share, helped by stable performance of franchise retail assets within its regional mall, premium outlet and mills platforms. Quarterly revenues decreased to $924.93 million from $935.59 million in the prior-year quarter.
Another peer, Houston, Texas-based Weingarten Realty Investors (WRI | Quote | Chart | News | PowerRating) reported last week a decline in FFO for the third quarter to $29.73 million or $0.25 per share from $59.89 million or $0.71 per share, primarily reflecting a non-cash impairment charge. Total quarterly revenues decreased to $144.54 million from $153.97 million a year ago.
Other Metrics
Net operating income or NOI, for the third quarter edged down to $133.66 million from $135.84 million in the prior-year quarter, and total rental property expenses were $58.22 million, up from $54.11 million in the year-ago quarter.
Same-property NOI on an aggregate basis declined 3.6% from the third quarter of 2008, reflecting a decline in occupancy as well as a two percentage points impact of lost rent and recoveries from Linens N Things, Circuit City and Value City.
Kimco's shopping center portfolio of 914 operating properties, includes 805 assets in the U.S. and Puerto Rico, 51 in Canada, 48 in Mexico and ten in South America. It has another 18 development properties, including four assets in the U.S., nine in Mexico and five in South America. The company posted quarter end occupancy of 92.4% for the entire shopping center portfolio, with 91.9% occupancy in the U.S. portfolio.
At the end of the third quarter, the company owned interests in 1,462 retail properties comprising 153 million square feet of leasable space across 45 U.S. states, Puerto Rico, Canada, Mexico and South America.
The company's board of directors also declared a quarterly cash dividend of $0.16 per common share, payable on January 15, to shareholders of record on January 4, 2010.
On Tuesday, the company announced the appointment of President and Chief Investment Officer David Henry as chief executive officer of the company, effective December 31, 2009, succeeding Milton Cooper will continue to serve as executive chairman. Henry joined Kimco in 2001 as vice chairman and chief investment officer after 23 years with GE Real Estate. In November 2008, he was named president at Kimco. Henry currently also serves on the board of directors of Health Care Properties, Inc. (HCP | Quote | Chart | News | PowerRating).
Nine-Month Highlights
For the nine-month period, the company posted FFO of $167.64 million or $0.49 per share, sharply lower than $512.36 million or $1.98 per share in the prior-year period. Excluding non-cash impairments and charges for the acceleration of deferred costs from early debt repayment, FFO for the period dropped to $349.4 million or $1.03 per share from $522.07 million or $2.01 per share in the year-ago period.
Net loss available to common shareholders for the period totaled $91.59 million or $0.27 per share, compared to net income of $265.96 million or $1.03 per share in the comparable period a year ago.
Revenues from rental properties for the year-to-date period grew to $575.07 million from $561.72 million in the same period last year.
Outlook
Looking ahead to fiscal 2009, the company lowered its estimates for funds from operations before non-cash impairments to a range of $1.30 to 1.33 per share from the range of $1.33 to $1.38 per share. Including non-cash impairments,, the company expects funds from operations in the range of $0.79 to $0.82 per share. The Street is currently looking for full year FFO of $0.83 per share.
Stock Quote
KIM closed Wednesday's regular trading session at $12.48, down $0.49 or 3.78% on a volume of 10.70 million shares, higher than the three-month average volume of 9.16 million shares. In the past 52-week period, the stock has been trading in a range of $6.33 to $22.47.
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