), a top real estate investment trust (REIT) operating self-storage
facilities, reported fourth quarter 2011 FFO (funds from
operations) of $1.50 per share, compared with $1.33 in the
year-earlier quarter. Fund from operations, a widely used metric to
gauge the performance of REITs, is obtained after adding
depreciation and amortization and other non-cash expenses to net
Excluding several non-recurring items, FFO for fourth quarter
2011 was $1.66 per share compared with $1.45 in the year-ago
quarter. Recurring FFO for fourth quarter 2011 exceeded the Zacks
Consensus Estimate by 7 cents.
For full year 2011, Public Storage reported FFO of $5.67 per
share, compared with $4.72 in the previous year. Recurring FFO for
fiscal 2011 was $5.93 per share compared with $5.22 in 2010. Fiscal
2011 recurring FFO surpassed the Zacks Consensus Estimate by 15
During the reported quarter, Public Storage recorded a healthy
increase in total revenues to $444.7 million from $417.8 million in
the year-earlier quarter. Total revenues for the reported quarter
were well ahead of the Zacks Consensus Estimate of $422 million.
For full year 2011, the company reported total revenues of
approximately $1.75 billion compared to $1.64 billion in the
Total same-store revenues increased 5.0% year-over-year to
$382.3 million during the quarter, while net operating income
climbed 6.1% to $278.7 million. The increase in same-store revenues
was primarily due to a 1.3% increase in average occupancy and a
3.4% rise in realized annual rent per occupied square foot.
Occupancy in the same-store portfolio was 90.2% at quarter-end
versus 89.0% in the prior-year period. Realized annual rent per
occupied square foot increased from $12.79 in the year-earlier
quarter to $13.22 in the reported quarter.
Public Storage currently has a 49% stake in Shurgard Europe,
which has interests in 188 facilities (10 million net rentable
square feet) located in 7 Western European countries. Public
Storage is also the managing member of the JV that owns Shurgard
During the quarter, Public Storage acquired 2 self-storage
facilities spanning across 155,000 square feet of rentable space
for $16.0 million. The properties were located in California and
Texas. The company also acquired the remaining ownership interests
in 2 consolidated partnerships for $6.3 million in cash. In
addition, during the reported quarter Public Storage entered into a
contract to acquire a portfolio of 6 self-storage properties (2 in
Florida and 1 each in California, Massachusetts, New Jersey and
Pennsylvania) for an aggregate purchase price of $42 million in
With superior quarterly and fiscal results that witnessed a
healthy increase in both revenues and earnings, the company
increased its quarterly dividend for first quarter 2012 by 16% to
$1.10 per share. Funds from operations available for distribution (
) among common shareholders exceeded the regular common
distributions by $113.2 million during the quarter. At year-end
2011, Public Storage had $139.0 million of cash compared to $456.3
million in the year-ago period.
We maintain our 'Neutral' rating on the stock, which presently
has a Zacks #2 Rank, translating into a short-term 'Buy' rating. We
also have a 'Neutral' recommendation and a Zacks #2 Rank for
Sovran Self Storage Inc.
), one of the competitors of Public Storage.
PUBLIC STORAGE (
): Free Stock Analysis Report
SOVRAN SLF STOR (
): Free Stock Analysis Report
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