Home Properties Inc. reported a decrease in funds from operations in the first quarter due, in part, to the severe winter weather.
Home Properties reported FFO of $67.6 million, or $1 a share, compared with $66 million, or $1.05 a share, a year ago. That equates to a 5.4 percent decrease on a per-share basis.
First-quarter FFO included 4 cents in costs related to record severe weather, above the budgeted normal winter, that resulted in increased costs in the majority of the company's market areas.
Excluding the extreme variance in weather-related costs, FFO per share would have been $1.04, the company reported.
Sales were $168.1 million, up from sales of $161.7 million during last year’s quarter.
Analysts had expect Home Properties to report FFO per share of $1.05. The analysts expected sales to grow 1 percent to $169 million.
Earnings per share were 79 cents, compared with 99 cents a year ago. The 20-cent reduction primarily was attributed to a $9.1 million decrease in the gain on disposition of property, partially offset by a $1.5 million increase in income from continuing operations.
"While first-quarter funds from operations per share were 4 cents below our expectations as a result of costs related to severe winter weather, rate increases on expiring leases have been very encouraging," said Edward Pettinella, Home Properties president and CEO, in a statement. "Rents on new leases, compared to expiring leases, increased steadily month-over-month into May, a positive sign of the typical upturn we expected during the spring leasing season."
The company guidance on FFO per share results for the second quarter is $1.09 to $1.13.
The firm’s stock (NYSE: HME) closed Thursday at $61.94, up slightly from Wednesday’s close of $61.60. The company reported its results after the market closed.
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