FIBRA Prologis Announces Second Quarter 2020 Earnings Results

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Jul 22, 2020, 20:54 ET

MEXICO CITY, July 22, 2020 /PRNewswire/ -- FIBRA Prologis (BMV:FIBRAPL 14), a leading owner and operator of Class-A industrial real estate in Mexico, today reported results for the second quarter of 2020.

HIGHLIGHTS FROM THE QUARTER:

Rent collections were 97.9 percent.
Period-end occupancy was 95.5 percent.
Net effective rent on rollovers increased 13.2 percent.
Weighted average customer retention was 82.6 percent.
Same store cash NOI decreased 11.4 percent.
Completed asset acquisitions totaled Ps.8.8 billion (US$358.5 million).

Net earnings per CBFI was Ps. (0.4416) (US$(0.0189)) for the quarter compared with Ps. 0.7487 (US$0.0395) for the same period in 2019.

Funds from operations (FFO) per CBFI as defined by FIBRA Prologis was Ps. 0.9131 (US$0.0383) for the quarter compared with Ps. 0.8325 (US$0.0434) for the same period in 2019.

STRONG OPERATING RESULTS CONTINUE

"Our performance in the quarter exceeded our expectations, underscoring the resiliency of our investment strategy," said Luis Gutiérrez, CEO, Prologis Property Mexico. "While COVID-19 continues to affect daily life, our portfolio and customers are key contributors to the supply chain that serves the stay-at-home economy. We remain cautiously optimistic in our outlook given the adoption of e-commerce and nearshoring of manufacturing operations, both of which advanced in the first half of the year and show no signs of slowing down."

Gutierrez added: "Despite uneven macroeconomic conditions, FIBRA Prologis was able to acquire Prologis Park Grande, the premier logistics park in Mexico City, as well as two, urban, Last Touch® facilities. The acquisitions deepen our presence in the country's key consumption."

Operating Portfolio	2Q20	2Q19	Notes
Period End Occupancy	95.5%	96.6%	Three of six markets above 95%
Leases Commenced	5.1 MSF	2.0 MSF	66% of leasing activity related to Mexico City and Guadalajara; 64% of 2020 expirations addressed in 1H 2020
Customer Retention	82.6%	85.1%
Net Effective Rent Change	13.2%	16.0%	Four of six markets recorded positive net effective rent change of at least 10%
Same Store Cash NOI	-11.4%	3.9%	Higher concessions, the result of longer lease terms along with a weaker peso and lower average occupancy partly offset by higher rents
Same Store NOI	-6.0%	0.9%

SOLID FINANCIAL POSITION

At June 30, 2020, FIBRA Prologis' leverage was 29.0 percent and liquidity was Ps. 6.6 billion (US$283.0 million), which included Ps. 5.9 billion (US$255.0 million) of available capacity on its unsecured credit facility and Ps. 658.0 million (US$28.4 million) of unrestricted cash.

GUIDANCE UPDATE

"FIBRA Prologis reported solid operational and financial performance while maintaining significant liquidity," said Jorge Girault, senior vice president, Finance, Prologis Property Mexico. "While we have no visibility into how long the pandemic will last, we are encouraged by our performance. As a result, we are adjusting our guidance to reflect our current outlook for the second half of 2020."

(US$ in million, except per CBFI amounts) 22.75MXN per USD (average for full year)	Previous	Revised
FFO per CBFI*	US$0.1400 – 0.1600	US$0.1550 – 0.1650
Full Year 2020 Distributions per CBFI	US$0.097	US$0.097
Year End Occupancy	94.0 – 96.0%	95.0 – 96.0%
Same Store NOI (Cash)**	-4.0 – 1.0%	-5.0 – -3.0%
Annual Capital Expenditures as % of NOI	13.0 – 14.0%	13.0 – 14.0%
Asset Management and Professional Fees	US$19.0	US$19.0 – 21.0
Building Acquisitions	US$350 – 400.0	US$350 – 400.0

*Excludes the impact of foreign exchange movements

** Based in U.S. dollars

WEBCAST & CONFERENCE CALL INFORMATION

FIBRA Prologis will host a live webcast/conference call to discuss quarterly results, current market conditions and future outlook. Here are the event details:

Thursday, July 23, 2020, at 9 a.m. CT/10 a.m. ET.
Live webcast at www.fibraprologis.com, in the Investor Relations section, by clicking News & Events.
Dial in: +1 833 714-0919 or +1 778 560-2663 and enter Passcode 8796378.

A telephonic replay will be available July 23–July 30 at +1 800 585-8367 from the U.S. and Canada or at +1 416 621-4642 from all other countries using conference code 8796378. The replay will be posted in the Investor Relations section of the FIBRA Prologis website.

ABOUT FIBRA PROLOGIS

FIBRA Prologis is a leading owner and operator of Class-A industrial real estate in Mexico. As of June 30, 2020, FIBRA Prologis was comprised of 201 logistics and manufacturing facilities in six industrial markets in Mexico totaling 39.0 million square feet (3.6 million square meters) of gross leasable area.

FORWARD-LOOKING STATEMENTS

The statements in this release that are not historical facts are forward-looking statements. These forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which FIBRA Prologis operates, management's beliefs and assumptions made by management. Such statements involve uncertainties that could significantly impact FIBRA Prologis financial results. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements, which generally are not historical in nature. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future — including statements relating to rent and occupancy growth, acquisition activity, development activity, disposition activity, general conditions in the geographic areas where we operate, our debt and financial position, are forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our expectations will be attained and therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Some of the factors that may affect outcomes and results include, but are not limited to: (i) national, international, regional and local economic climates, (ii) changes in financial markets, interest rates and foreign currency exchange rates, (iii) increased or unanticipated competition for our properties, (iv) risks associated with acquisitions, dispositions and development of properties, (v) maintenance of real estate investment trust ("FIBRA") status and tax structuring, (vi) availability of financing and capital, the levels of debt that we maintain and our credit ratings, (vii) risks related to our investments (viii) environmental uncertainties, including risks of natural disasters, (ix) risks related to the coronavirus pandemic, and (x) those additional factors discussed in reports filed with the "Comisión Nacional Bancaria y de Valores" and the Mexican Stock Exchange by FIBRA Prologis under the heading "Risk Factors." FIBRA Prologis undertakes no duty to update any forward-looking statements appearing in this release.

Non-Solicitation - Any securities discussed herein or in the accompanying presentations, if any, have not been registered under the Securities Act of 1933 or the securities laws of any state and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements under the Securities Act and any applicable state securities laws. Any such announcement does not constitute an offer to sell or the solicitation of an offer to buy the securities discussed herein or in the presentations, if and as applicable.

SOURCE FIBRA Prologis