The momentum going into 2018 has continued through the second quarter. That is according to Prologis chairman and CEO Hamid Moghadam. According to the REIT’s second quarter report, the logistics leader reported net earnings per diluted share at $0.62 compared with $0.50 for the same period in 2017.
“Our portfolio and balance sheet are in the best shape ever, and our team continues to deliver excellent results while remaining laser-focused on platform initiatives that will increase our competitive advantages,” explains Moghadam.
He adds that “Trade is dominating the headlines. If today’s political rhetoric translates into significant protectionist policies, long-term economic growth will suffer, and this will affect all businesses, including ours. As of now, however, our customers are moving forward with their growth plans and we have not seen a change in sentiment or decision-making.”
During the second quarter, the company and its co-investment ventures completed over $850 million of financings, including the previously announced $400 million 10-year bond at 3.875% and $300 million 30-year bond at 4.375%. The company ended the quarter with leverage of 22.9 percent on a market capitalization basis, debt-to-adjusted EBITDA* of 4.1x and $4.0 billion of liquidity.
According to the firm’s Thomas Olinger, chief financial officer, market fundamentals are the healthiest on record. “Our improved outlook for market rental growth combined with our year-to-date performance leads us to increase and narrow our full-year guidance ranges for earnings and same store NOI.”
Olinger added, “The spread between our in-place leases and market rents widened further in the quarter, extending our runway for sector-leading growth.”
BTIG, an analyst in the REIT space, said that they expect to see further positive revisions through 2018 for the company, noting that it expects the multi-year growth cycle for Prologis to continue.