Cousins Properties Inc. (NYSE:CUZ) reported second-quarter 2016 adjusted funds from operations (“FFO”) of 22 cents per share. The Zacks Consensus Estimate was also 22 cents. Including the merger related costs, FFO for second-quarter 2016 came in at 21 cents. FFO for second-quarter 2015 was 21 cents per share.
Quarter in Detail
During the quarter, rental property revenues came in at $90.7 million, down 5.7% year over year. However, the figure beat the Zacks Consensus Estimate of $89 million.
Cousins Properties leased or renewed 402,213 square feet of office space in the quarter. Same property net operating income, on cash basis, rose 3.9% year over year. Moreover, second generation net rent per square foot (cash basis) moved 4.3% north.
During the quarter, the company inked a merger deal with Parkway Properties, Inc. (NYSE:PKY) for combing the operations of these two entities and thereafter the Houston assets of this combined entity will be spun-off into a separate public REIT.
Finally, Cousins Properties exited the quarter with cash and cash equivalents of $946, 000, down from $2.0 million at the end of the prior year.
2016 Outlook
Cousins Properties has withdrawn its 2016 FFO guidance, taking into consideration the Apr 29 announcement regarding the signing of definitive merger and spin-off agreement.
Our Take
While we are encouraged with the definitive deal with Parkway Properties, the year-over-year decline in revenues clearly remains a concern.
Currently, both Cousins Properties and Parkway Properties carry a Zacks Rank #2 (Buy).
We now look forward to the earnings releases of Duke Realty Corp. (NYSE:DRE) and Kimco Realty Corp. (NYSE:KIM) which are scheduled this week.
Note: All EPS numbers presented in this write up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
KIMCO REALTY CO (KIM): Free Stock Analysis Report
DUKE REALTY CP (DRE): Free Stock Analysis Report
COUSIN PROP INC (CUZ): Free Stock Analysis Report
PARKWAY PPTY (PKY): Free Stock Analysis Report
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