General Growth Properties (GGP) Tops Q3 EPS by 12c, Beat on Revenues; Offers FY17 EPS Mid-Point Guidance Above Consensus

General Growth Properties (NYSE: GGP) reported Q3 EPS of $0.23, $0.12 better than the analyst estimate of $0.11. Revenue for the quarter came in at $578.36 million versus the consensus estimate of $549.44 million.

Operating Results

• For the three months ended September 30, 2017, net income attributable to GGP was $223 million, or $0.23 per diluted share, as compared to $674 million, or $0.70 per diluted share, in the prior year period. For the nine months ended September 30, 2017, net income attributable to GGP was $456 million, or $0.47 per diluted share, as compared to $1.05 billion, or $1.09 per diluted share, in the prior year period.
• Net income attributable to GGP decreased 67.0% from the prior year period primarily due to 2016 gains related to the sale of interests in three properties.
• The Company declared a fourth quarter common stock dividend of $0.22 per share. The full year dividend of $0.88 cents represents an increase of 10% over 2016.

Company Operating Results

• Company Same Store Net Operating Income (“Company Same Store NOI”) increased 2.0% and 1.8% from the prior year period for the three and nine months ended September 30, 2017, respectively.
• For the three months ended September 30, 2017, Company Net Operating Income (“Company NOI”) as adjusted was $561 million as compared to $546 million in the prior year period, an increase of 2.8%. For the nine months ended September 30, 2017, Company NOI as adjusted was $1.67 billion as compared to $1.64 billion, an increase of 2.4%.2
• For the three months ended September 30, 2017, Company Earnings Before Interest, Taxes, Depreciation and Amortization (“Company EBITDA”) as adjusted was $532 million as compared to $507 million in the prior year period, an increase of 4.8%. For the nine months ended September 30, 2017, Company EBITDA as adjusted was $1.56 billion as compared to $1.51 billion, an increase of 3.3%.2
• For the three months ended September 30, 2017, Company Funds From Operations (“Company FFO”) was $355 million, or $0.37 per diluted share, as compared to $336 million, or $0.35 per diluted share, in the prior year period. For the nine months ended September 30, 2017, Company FFO was $1.04 billion, or $1.09 per diluted share, as compared to $1.06 billion, or $1.10 per diluted share, in the prior year period.
• Same Store leased percentage was 96.5% at quarter end.
• Initial NOI weighted rental rates for signed leases that have commenced in the trailing twelve months on a suite-to-suite basis increased 14.9% when compared to the rental rate for expiring leases.
• For the trailing twelve months, NOI weighted tenant sales per square foot (<10K sf) were $708 an increase of 2.1% over the prior year.
• Tenant sales (all less anchors) increased 0.1% on a trailing 12-month basis, excluding apparel the increase is 2.5%.

GUIDANCE:

General Growth Properties sees Q4 2017 EPS of $0.21-$0.23, versus the consensus of $0.21.

For earnings history and earnings-related data on General Growth Properties (GGP) click here.

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