Post Earnings Coverage as Regency’s Core FFO Jumped 13%; Raised Guidance

Upcoming AWS Coverage on Federal Realty Investment Trust Post-Earnings Results

LONDON, UK / ACCESSWIRE / May 25, 2017 / Active Wall St. announces its post-earnings coverage on Regency Centers Corp. (NYSE: REG). The Company released its first quarter fiscal 2017 financial results on May 09, 2017. The shopping center REIT exceeded top- and bottom-line expectations. Register with us now for your free membership at:

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One of Regency Centers’ competitors within the REIT – Retail space, Federal Realty Investment Trust (NYSE: FRT), reported on May 03, 2017, its operating results for its first quarter ended March 31, 2017. AWS will be initiating a research report on Federal Realty Investment Trust in the coming days.

Today, AWS is promoting its earnings coverage on REG; touching on FRT. Get our free coverage by signing up to:

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Earnings Reviewed

For the quarter ended March 31, 2017, Regency reported revenue of $196.1 million compared to revenue of $149.5 million in the year ago same period and ahead of analysts’ consensus estimates of $185.4 million.

For Q1 2017, Regency reported net loss attributable to common stockholders of $33.2 million, or $0.26 per diluted share, compared to net income attributable to common stockholders of $47.9 million, or $0.49 per diluted share, for Q1 2016. The Company’s net loss for the reported quarter includes one-time merger related costs of $69.7 million, or $0.55 per share.

Regency reported NAREIT Funds from Operations (NAREIT FFO) for Q1 2017 of $34.2 million, or $0.27 per diluted share. Excluding the one-time merger related costs of $69.7 million, NAREIT FFO for the reported quarter was $103.9 million, or $0.82 per diluted share, compared to $84.4 million, or $0.86 per diluted share, for the year ago comparable period. Regency’s Core Funds from Operations (Core FFO) for Q1 2017 was $114.3 million, or $0.90 per diluted share, compared to $78.8 million, or $0.80 per diluted share, for Q1 2016 and ahead of Wall Street’s expectations for Core FFO of $0.83 per share.

Segment Results

During Q1 2017, Regency’s same property NOI, excluding termination fees, increased 3.7% on a y-o-y basis. This growth included a 60 basis point positive impact from redevelopments.

As of March 31, 2017, Regency’s wholly owned portfolio plus its pro-rata share of co-investment partnerships was 95.3% leased, and same property was leased 96.0%. Within the same property portfolio, spaces less than 10,000 square feet (“Small Shops”) were 91.7% leased, which reflects the combination of the Regency and Equity One portfolios following the merger. For the reported quarter, the combined portfolio, same property leased percentage was down 20 basis points from the year ago same period. The change in Small Shops leased percentage for the combined portfolio was up 70 basis points from Q1 2016.

During Q1 2017, Regency executed 1.1 million square feet of comparable new and renewal leases at blended rent spreads of 8.2%. Rent spreads on new and renewal leases were 0.2% and 10.0%, respectively. New rent spreads during the reported quarter were impacted by one anchor lease in a shopping center targeted for sale. Excluding this lease, new rent spreads during Q1 2017 were 10.3% and when blended with renewal leasing activity, total rent spreads were 10.0%.

Investments

Property Transactions

During Q1 2017, Regency sold one co-investment property, for a total gross sales price of $21.0 million. Regency’s share of the gross sales price was $4.2 million.

Developments and Redevelopments

During Q1 2017, Regency started the development of two projects with combined estimated net development costs totaling $61.0 million. The first, The Field at Commonwealth, is an 187,000 square foot center located in the Washington D.C. metro area, with estimated net development costs of $44.6 million. The second development start, Pinecrest Place, is a 70,000 square foot center located within a dense infill submarket of Miami and has estimated net development costs of $16.4 million. At end of Q1 2017, the Company had 30 projects in development or redevelopment with combined, estimated costs of $515 million. In-process projects were a combined 46% funded and 84% leased and committed.

Debt Offering

During Q1 2017, Regency completed the sale of two tranches of senior unsecured notes, $350 million 3.6% notes due 2027 and $300 million 4.4% notes due 2047. Interest on both tranches would be payable semiannually on February 01 and August 01 of each year, with the first payment on August 01, 2017.

Preferred Redemption

During Q1 2017 Regency redeemed all of the issued and outstanding 6.625% series 6 cumulative redeemable preferred shares. The 10,000,000 shares of Preferred Stock were redeemed on February 16, 2017. The redemption price for the Preferred Stock was $25.21163 per share, which is equal to $25.00 plus accrued and unpaid dividends to, but excluding, the Redemption Date. The aggregate amount paid to redeem the Preferred Stock was $252 million.

Dividend

On April 26, 2017, Regency’s Board of Directors declared a quarterly cash dividend on its common stock of $0.53 per share. The dividend is payable on May 31, 2017, to shareholders of record as of May 22, 2017.

2017 Guidance

Regency raised its FY17 core FFO per share guidance to be in the range of $3.60–$3.68 band, from the previous guided range of $3.44–$3.50.

Stock Performance

At the close of trading session on Wednesday, May 24, 2017, Regency Centers’ stock price rose 1.99% to end the day at $61.97. A total volume of 1.35 million shares were exchanged during the session. The Company’s shares are trading at a PE ratio of 91.67 and have a dividend yield of 3.42%. The stock currently has a market cap of $10.47 billion.

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