PEPR Q1 earnings down 24%

Prologis European Properties, the leading owner of modern distribution facilities, reported earnings of EUR 22.4 mln for the first quarter of 2010, 24% down on the EUR 29.3 mln booked in the same period last year. The Euronext-listed company said the decrease was driven by a EUR 3.6 mln decline in total revenue to EUR 64.5 mln, EUR 1.4 mln in writedowns and EUR 2.8 mln in higher taxes.

EPRA earnings, which provide a guide to underlying business performance, decreased by EUR 8.4 mln to EUR 20.8 mln from EUR 29.2 mln for the same period last year, primarily driven by a EUR 6.2 mln decline in rental income, EUR 1.1 mln of accelerated loan amortisation costs and EUR 2.1 mln of higher taxes. This was partially offset by EUR 2.7 mln in lower interest charges.

The decline in revenue reflected the loss of EUR 4.2 mln of rental income from portfolio sales in 2009 and a EUR 2.4 mln decline in rental income as a result of leases rolling back to market. This was partially offset by the one-off receipt of EUR 2.6 mln following the finalisation of insurance and legal claims related to properties in Hemel Hempstead, UK, that were damaged in the Buncefield oil terminal explosion at the end of 2005.

PEPR said it received EUR 392.6 mln of new secured financing, eliminating all debt maturities until December 2012 and further reducing the loan-to-value ratio to 53.7% (2009: 55.0%). Thirty one lease transactions were concluded, covering 452,300m². This was more than double the volume for Q1 2009 (16 lease transactions, covering 178,300m2). The high portfolio occupancy at 94.8% was down 1.3% since end 2009.