* Q1 FFO 63 cents, matching Street view
* Sees 2010 FFO $2.55 to $2.75 per share
* Shares close at $43.23, unchanged after hours
(Adds analysts view, share price, details)
NEW YORK, April 22 Taubman Centers Inc (TCO.N),
an owner of upscale shopping malls, said its quarterly funds
from operations (FFO) fell 15 percent compared with a year
earlier, partly as a result of lower rents.
But sales surged at its malls, especially those in areas
that had been hardest hit by the recession.
The company also included a charge for the transfer of a
loan on property it is returning to a lender, but it maintained
its forecast for the year.
"Tenant sales are the best predictor of the leasing
environment ahead," CEO Robert Taubman said in a statement.
"Retailers' expectations have improved markedly and they
are becoming more aggressive about their expansion plans."
First-quarter FFO totaled $33.5 million, or 60 cents per
share, compared with $39.4 million, or 70 cents per share, in
the year-earlier quarter.
The results included a charge of 3 cents per share in the
first quarter of 2010 and 1-cent per share in the prior year's
quarter for the company's writeoff of its investment in The
Pier Shops at Caesars in Atlantic City, New Jersey.
Excluding the charge, FFO met the average analyst forecast
of 63 cents per share, according to Thomson Reuters I/B/E/S.
Rents were lower and lease cancellation income was higher
than in the year earlier quarter. Pre-development expenses were
also higher in the latest quarter, in part due to nonrecurring
consultant fees, Taubman said.
Tenant sales, which began to pick up in the fourth quarter
of 2009, surged in the first quarter of the new year, rising10.8 percent over the prior year and bringing the company's
12-month trailing sales per square foot to $509. Sales growth
was particularly strong in Michigan and Florida.
The Bloomfield Hills, Michigan-based company, which owns 26
U.S. malls, said the average occupancy during the quarter was
88.2 percent, below the 88.8 percent of a year earlier.
Rent fell to $43.20 per square foot from $44.48.
Although the company maintained its 2010 forecast for FFO
in the range of $2.55 to $2.75 per share, it said it would
include a charge of 6 cents per share for The Pier Shops,
effectively increasing the range.
In addition, a noncash accounting gain is now expected to
be recognized when the loan obligation on The Pier Shops is
extinguish when it is transferred, the company said.
Analysts had expected the company to post 2010 FFO of $2.63
per share, according to Thomson Reuters I/B/E/S.
Taubman shares closed 1.2 percent higher at $43.23 on the
New York Stock Exchange before the results were released. They
were unchanged in after-hours trade.
(Reporting by Ilaina Jonas, editing by Matthew Lewis and