Tanger Factory Outlet Centers (NYSE: SKT) reported Q1 EPS of $0.24, in-line with the analyst estimate of $0.24. Revenue for the quarter came in at $123.54 million versus the consensus estimate of $122.23 million.

The Company is updating its guidance for 2018, primarily due to a revision of average occupancy expectations, as a result of the store closures caused by tenant bankruptcies, the effect of a harsh winter in the first quarter of 2018, and select rent adjustments to maintain high occupancy. Based on this updated outlook, management currently believes its net income and FFO for 2018 will be as follows:

Tanger's estimates reflect the following adjustments to key assumptions:

• Portfolio NOI growth for the consolidated portfolio between (0.5)% and 0.5%, compared to the prior range of 0.5% and 1.5%
• Same Center NOI guidance for the consolidated portfolio between (2.5)% and (1.5)%, compared to the prior range of (1.0)% and 0.0% reflecting the following:
  • Projected average occupancy for the year is expected to be between 95.0% and 95.5%, down from the Company\'s previous forecast of approximately 96.0%
  • Projected 2018 store closings totaling between 150,000 and 175,000 square feet for the consolidated portfolio, increased from the original expectation of approximately 100,000 square feet
  • The impact of lease modifications and renewals with terms of 12 months or less commencing in 2017 and 2018, which the Company strategically executed to preserve upside potential and maintain high occupancy
  • Higher non-reimbursed snow removal expenses in the first quarter and reduced estimates for variable rents due to the center closings caused by winter storms
• Projected full year lease termination fees (which are not included in Same Center NOI) of approximately $1.5 million for the consolidated portfolio, compared to the prior estimate of $1.0 million
• The Company\'s share of interest expense in the unconsolidated portfolio of $6.5 million to $7.5 million, compared to the prior range of $6.0 to $7.0 million
• 2018 weighted average diluted common shares of approximately 93.2 million for earnings per share and 98.2 million for FFO per share, compared to the prior estimates of 93.1 million and 98.1 million, respectively
• Combined recurring capital expenditures and second generation tenant allowances of approximately $35 million to $40 million

GUIDANCE:

Tanger Factory Outlet Centers sees FY2018 EPS of $0.95-$1.01.

For earnings history and earnings-related data on Tanger Factory Outlet Centers (SKT) click here.