Simon Property tops expectations with fourth quarter results

Simon Property Group Inc. on Tuesday announced fourth quarter financial results that exceeded Wall Street expectations.

The Indianapolis-based shopping mall giant reported funds from operations, or FFO, of $912.2 million, or $2.91 per share, in the period. The average prediction of eight analysts surveyed by Zacks Investment Research was for FFO of $2.51 per share.

FFO is a closely watched measure among real estate investment trusts that takes net income and adds back items such as depreciation and amortization.

FFO was up 5.4 percent from the same quarter of 2015, when it came in at $866.5 million, or $2.40 per share.

Simon also posted revenue of $1.43 billion in the latest period, beating the analysts’ forecast of $1.42 billion. Revenue was up from $1.38 billion in a year-ago period.

The company said it turned a profit of $394.4 million, or $1.26 per share, in the quarter, up from $392.3 million, or $1.27 per share, in the same quarter of 2015.

For the year, the company reported funds from operations of $3.79 billion, or $10.87 per share. Revenue was reported as $5.44 billion.
Simon said it expects full-year FFO to come in at $11.45 to $11.55 per share.

"I am pleased with our strong fourth quarter results, concluding another very successful and productive year for our company," CEO David Simon said in a written statement. "In 2016, we opened three new centers, delivered four significant property transformations and completed several major financing transactions that reinforced our industry-leading balance sheet.”

Simon said its mall and shopping outlet portfolio saw a rise in occupancy from 96.1 percent at year-end 2015 to 96.8 percent at the end of 2016. Base minimum rents per square foot rose 5.4 percent over that period, to $51.59.

The company declared a quarterly stock dividend of $1.75 per share, a 10-cent increase from the previous quarter.

Simon stock rose 2 percent Tuesday morning, to $181.53 per share.