General Growth Properties, Inc (NYSE:GGP) Q3 2016 Earnings Conference Call - Final Transcript

Nov 01, 2016 • 09:00 am ET


General Growth Properties, Inc (NYSE:GGP) Q3 2016 Earnings Conference Call - Final Transcript


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Good day, ladies and gentlemen, and welcome to the GGP's Third Quarter 2016 Earnings Conference Call. [Operator Instructions].

I would now like to turn the call over to your host for today, Kevin Berry. You may begin.

Kevin Berry

Thank you, Sonia. Good morning, everyone, and welcome to General Growth Properties Third Quarter 2016 Earnings Call hosted by Sandeep Mathrani, our CEO; and Michael Berman, our CFO.

Please note that, certain statements made during this call may be deemed forward-looking statements within the meaning of the Safe Harbor of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially due to a variety of risks, uncertainties, and other factors. Please reference our earnings press release and SEC filings for a detailed discussion.

Statements made during this call may include time-sensitive information, accurate only as of today, November 1, 2016. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included in the release and supplemental filed in Form 8-K with the SEC and also available on our website.

It's my pleasure to turn the call over to Sandeep.

Sandeep Lakhmi Mathrani

Thank you, Kevin, and good morning, everyone. Let me begin by highlighting the quarter. FFO per share came in a $0.35 and within our guidance range. For the year, we're at $1.10 per share about 9% higher than last year. Same-store NOI was up approximately 4% for the quarter and the year. EBITDA was up slightly better than 4.5% for the quarter and over 10% for the year.

We're pleased with our earnings growth this year especially in light of our strong growth last year. Based on our financial performance to-date, we're pleased to announce a $0.02 increase to our quarterly dividend, our cash dividend this year will be $0.80 double that from when we began in 2011 albeit a much smaller portfolio base.

Our leverage on a net debt to EBITDA basis is under 8 times. From the very beginning, we've communicated a path to lower leverage. We've no unsecured debt and are sitting on more cash than we have in the last five years. Lower leverage today has been from meticulous efforts to sell lower quality assets that also had high leverage, paying down debt and growing EBITDA.

Our portfolio of high quality retail properties throughout the country continues to deliver results above the national average. Total sales performed well across the portfolio, up 1.4% as consumers visit our centers for their shopping, dining and entertainment needs.

As we look at the top retailers in our portfolio L Brands sales increased 8.7% in their stores, at a less than 10,000 square feet and increased 5.5% for all their stores which include stores larger than 10,000 square feet. Within our portfolio, three of the four largest tenants posted similar strong sales increases.

Not all retail square feet is equal. High quality assets and higher sales productivity when rated for NOI, sales per square foot in our portfolio is actually $687 a square foot and $675 excluding Christiana Mall.