Westfield's half-year earnings meet guidance
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The shopping mall operator meets earnings guidance with half-year funds from operations of US$342 million, but lowers guidance due to currency movements.
Westfield Corporation (ASX: WFD) has recorded funds from operations (FFO)--a preferred measure of real estate investment trusts' earnings--of US$342 million for the half-year ended 30 June 2016, in line with guidance.
FFO per security was 16.5 cents, up 3.1 per cent and adjusted for asset divestments and income lost from redevelopment projects underway, the shopping centre operator said in a statement to the ASX on Wednesday.
The distribution for the six months ended 30 June 2016 was 12.55 cents per security, also in line with guidance.
Westfield Corporation Co-CEOs, Peter Lowy and Steven Lowy, attributed the "pleasing" result to a solid performance from operations, with comparable net operating income for the portfolio for the six-month period up 3.9 per cent.
The portfolio was 94.8 per cent leased as at 30 June 2016, they said.
Last week, Westfield opened the US$1.5-billion Westfield World Trade Center in New York, fully leased and ahead of target yield.
"Current development projects at Westfield London, Century City in Los Angeles and UTC in San Diego are progressing well and we are about to commence the expansion of Valley Fair in San Jose," the Lowy brothers said.
"The development program is focussed on flagship assets in the world's leading markets and will produce assets that deliver great experiences for retailers, consumers and brands.
"Our US$9.5-billion program is expected to generate significant value and earnings accretion for shareholders."
Westfield said it expects to achieve FFO for 2016 of between 33.7 US cents and 34.0 US cents a share, down from a previous range between 34.2 and 34.5 US cents a share.
The update from the previous forecast is solely due to movements in the US dollar/British pound exchange rate, the company said.
Westfield's distribution guidance for 2016 remains unchanged at 25.1 cents per security.
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Nicholas Grove is a Morningstar journalist.
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