Public Storage (NYSE:PSA) announced today operating results for the
quarter ended March 31, 2015.
Operating Results for the Three Months Ended
March 31, 2015
For the three months ended March 31, 2015, net income allocable to our
common shareholders was $212.6 million or $1.23 per diluted common
share, compared to $174.1 million or $1.01 per diluted common share for
the same period in 2014 representing an increase of $38.5 million or
$0.22 per diluted common share. The increase is primarily due to a $39.9
million increase in self-storage net operating income, as a result of a
$25.5 million increase for our Same Store Facilities and a $14.4 million
increase for our Non Same Store Facilities. Revenues for the Same Store
Facilities increased 6.1% or $27.1 million in the quarter ended March
31, 2015 as compared to the same period in 2014, due primarily to higher
realized annual rent per occupied square foot. Cost of operations for
the Same Store Facilities increased by 1.1% or $1.6 million in the
quarter ended March 31, 2015 as compared to the same period in 2014, due
primarily to increases in property taxes and snow removal, offset
partially by lower allocated overhead. The increase in net operating
income for the Non Same Store Facilities is due primarily to the impact
of the acquisition of 48 self-storage facilities since January 2014.
Funds from Operations
For the three months ended March 31, 2015, funds from operations (“FFO”)
was $1.91 per diluted common share, as compared to $1.74 for the same
period in 2014, representing an increase of $0.17 per share. FFO is a
non-GAAP (generally accepted accounting principles) term defined by the
National Association of Real Estate Investment Trusts and generally
represents net income before depreciation, gains and losses and
impairment charges with respect to real estate assets.
We also present “Core FFO per share,” a non-GAAP measure that represents
FFO per share excluding the impact of (i) foreign currency exchange
gains and losses (ii) EITF D-42 charges related to the redemption of
preferred securities, and (iii) certain other items such as legal
settlements, recognition of deferred tax assets and costs associated
with the acquisition of real estate facilities. We believe Core FFO per
share is a helpful measure used by investors and REIT analysts to
understand our performance. However, Core FFO per share is not a
substitute for net income per share. Because other REITs may not compute
Core FFO per share in the same manner as we do, may not use the same
terminology, or may not present such a measure, Core FFO per share may
not be comparable among REITs.
The following table reconciles from FFO per share to Core FFO per share
(unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO per share
|
|
|
|
$
|
1.91
|
|
|
|
$
|
1.74
|
|
|
|
9.8
|
%
|
Eliminate the per share impact of items excluded from Core FFO:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency exchange loss
|
|
|
|
|
-
|
|
|
|
|
0.01
|
|
|
|
|
Application of EITF D-42
|
|
|
|
|
0.03
|
|
|
|
|
-
|
|
|
|
|
Other items
|
|
|
|
|
-
|
|
|
|
|
0.05
|
|
|
|
|
Core FFO per share
|
|
|
|
$
|
1.94
|
|
|
|
$
|
1.80
|
|
|
|
7.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Operations – Same Store Facilities
The Same Store Facilities represent those facilities that have been
owned and operated on a stabilized basis since January 1, 2013 and
therefore provide meaningful comparisons for 2014 and 2015. The Same
Store pool increased from 1,982 facilities at December 31, 2014 to 2,000
facilities at March 31, 2015. The following table summarizes the
historical operating results of these 2,000 facilities (127.0 million
net rentable square feet) that represent approximately 87% of the
aggregate net rentable square feet of our U.S. consolidated self-storage
portfolio at March 31, 2015.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Operating Data for the Same
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Store Facilities (2,000 facilities)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollar amounts in thousands, except for weighted average data)
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental income
|
|
|
|
$
|
450,272
|
|
|
|
|
$
|
422,911
|
|
|
|
|
6.5
|
%
|
Late charges and administrative fees
|
|
|
|
|
22,048
|
|
|
|
|
|
22,356
|
|
|
|
|
(1.4
|
)%
|
Total revenues (a)
|
|
|
|
|
472,320
|
|
|
|
|
|
445,267
|
|
|
|
|
6.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property taxes
|
|
|
|
|
50,149
|
|
|
|
|
|
48,133
|
|
|
|
|
4.2
|
%
|
On-site property manager payroll
|
|
|
|
|
26,964
|
|
|
|
|
|
27,206
|
|
|
|
|
(0.9
|
)%
|
Supervisory payroll
|
|
|
|
|
9,039
|
|
|
|
|
|
8,947
|
|
|
|
|
1.0
|
%
|
Repairs and maintenance
|
|
|
|
|
7,968
|
|
|
|
|
|
7,818
|
|
|
|
|
1.9
|
%
|
Snow removal
|
|
|
|
|
8,067
|
|
|
|
|
|
7,036
|
|
|
|
|
14.7
|
%
|
Utilities
|
|
|
|
|
10,512
|
|
|
|
|
|
10,752
|
|
|
|
|
(2.2
|
)%
|
Advertising and selling expense
|
|
|
|
|
6,192
|
|
|
|
|
|
6,572
|
|
|
|
|
(5.8
|
)%
|
Other direct property costs
|
|
|
|
|
13,003
|
|
|
|
|
|
12,548
|
|
|
|
|
3.6
|
%
|
Allocated overhead
|
|
|
|
|
10,615
|
|
|
|
|
|
11,919
|
|
|
|
|
(10.9
|
)%
|
Total cost of operations (a)
|
|
|
|
|
142,509
|
|
|
|
|
|
140,931
|
|
|
|
|
1.1
|
%
|
Net operating income (b)
|
|
|
|
$
|
329,811
|
|
|
|
|
$
|
304,336
|
|
|
|
|
8.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
|
|
69.8
|
%
|
|
|
|
|
68.3
|
%
|
|
|
|
2.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average for the period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Square foot occupancy
|
|
|
|
|
93.4
|
%
|
|
|
|
|
92.6
|
%
|
|
|
|
0.9
|
%
|
Realized annual rental income per (c):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Occupied square foot
|
|
|
|
$
|
15.19
|
|
|
|
|
$
|
14.39
|
|
|
|
|
5.6
|
%
|
Available square foot (“REVPAF”)
|
|
|
|
$
|
14.19
|
|
|
|
|
$
|
13.32
|
|
|
|
|
6.5
|
%
|
At March 31:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Square foot occupancy
|
|
|
|
|
93.9
|
%
|
|
|
|
|
93.1
|
%
|
|
|
|
0.9
|
%
|
Annual contract rent per occupied square foot (d)
|
|
|
|
$
|
15.80
|
|
|
|
|
$
|
15.01
|
|
|
|
|
5.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
|
Revenues and cost of operations do not include ancillary revenues
and expenses generated at the facilities with respect to tenant
reinsurance and retail sales.
|
|
|
|
|
|
|
|
(b)
|
|
|
See attached reconciliation of self-storage net operating income
(“NOI”) to operating income.
|
|
|
|
|
|
|
|
(c)
|
|
|
Realized annual rent per occupied square foot is computed by
dividing annualized rental income, before late charges and
administrative fees, by the weighted average occupied square feet
for the period. Realized annual rent per available square foot
(“REVPAF”) is computed by dividing annualized rental income, before
late charges and administrative fees, by the total available
rentable square feet for the period. These measures exclude late
charges and administrative fees in order to provide a better measure
of our ongoing level of revenue. Late charges are dependent upon the
level of delinquency and administrative fees are dependent upon the
level of move-ins. In addition, the rates charged for late charges
and administrative fees can vary independently from rental rates.
These measures take into consideration promotional discounts, which
reduce rental income.
|
|
|
|
|
|
|
|
(d)
|
|
|
Contract rent represents the applicable contractual monthly rent
charged to our tenants, excluding the impact of promotional
discounts, late charges and administrative fees.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table summarizes selected quarterly financial data with
respect to the Same Store Facilities (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
|
March 31
|
|
|
|
June 30
|
|
|
|
September 30
|
|
|
|
December 31
|
|
|
|
Full Year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Amounts in thousands, except for per square foot amounts)
|
Total revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
472,320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
445,267
|
|
|
|
|
$
|
457,649
|
|
|
|
|
$
|
481,407
|
|
|
|
|
$
|
473,239
|
|
|
|
|
$
|
1,857,562
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cost of operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
142,509
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
140,931
|
|
|
|
|
$
|
128,218
|
|
|
|
|
$
|
130,248
|
|
|
|
|
$
|
105,112
|
|
|
|
|
$
|
504,509
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
50,149
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
48,133
|
|
|
|
|
$
|
47,635
|
|
|
|
|
$
|
46,736
|
|
|
|
|
$
|
28,276
|
|
|
|
|
$
|
170,780
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Repairs and maintenance, including snow removal expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
16,035
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
14,854
|
|
|
|
|
$
|
9,548
|
|
|
|
|
$
|
9,998
|
|
|
|
|
$
|
9,441
|
|
|
|
|
$
|
43,841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advertising and selling expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
6,192
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
6,572
|
|
|
|
|
$
|
6,122
|
|
|
|
|
$
|
7,880
|
|
|
|
|
$
|
6,462
|
|
|
|
|
$
|
27,036
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVPAF:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
14.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
13.32
|
|
|
|
|
$
|
13.74
|
|
|
|
|
$
|
14.43
|
|
|
|
|
$
|
14.21
|
|
|
|
|
$
|
13.93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average realized annual rent per occupied square foot:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
$
|
15.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
$
|
14.39
|
|
|
|
|
$
|
14.50
|
|
|
|
|
$
|
15.24
|
|
|
|
|
$
|
15.20
|
|
|
|
|
$
|
14.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average occupancy levels:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
93.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
92.6
|
%
|
|
|
|
|
94.7
|
%
|
|
|
|
|
94.7
|
%
|
|
|
|
|
93.5
|
%
|
|
|
|
|
93.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Operations – Non Same Store Facilities
The Non Same Store Facilities at March 31, 2015 represent 246 facilities
that were not stabilized with respect to occupancies or rental rates
since January 1, 2013, or that we did not own as of January 1, 2013. The
following table summarizes operating data with respect to the Non Same
Store Facilities (unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON SAME STORE FACILITIES
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollar amounts in thousands, except square foot amounts)
|
Rental income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
$
|
623
|
|
|
|
|
$
|
-
|
|
|
|
|
$
|
623
|
|
2014 acquisitions
|
|
|
|
|
9,672
|
|
|
|
|
|
-
|
|
|
|
|
|
9,672
|
|
2013 acquisitions
|
|
|
|
|
25,930
|
|
|
|
|
|
22,199
|
|
|
|
|
|
3,731
|
|
Other facilities
|
|
|
|
|
22,092
|
|
|
|
|
|
18,121
|
|
|
|
|
|
3,971
|
|
Total rental income
|
|
|
|
|
58,317
|
|
|
|
|
|
40,320
|
|
|
|
|
|
17,997
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations before depreciation and amortization expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
|
204
|
|
|
|
|
|
-
|
|
|
|
|
|
204
|
|
2014 acquisitions
|
|
|
|
|
3,148
|
|
|
|
|
|
-
|
|
|
|
|
|
3,148
|
|
2013 acquisitions
|
|
|
|
|
8,343
|
|
|
|
|
|
8,644
|
|
|
|
|
|
(301
|
)
|
Other facilities
|
|
|
|
|
7,038
|
|
|
|
|
|
6,493
|
|
|
|
|
|
545
|
|
Total cost of operations
|
|
|
|
|
18,733
|
|
|
|
|
|
15,137
|
|
|
|
|
|
3,596
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
|
419
|
|
|
|
|
|
-
|
|
|
|
|
|
419
|
|
2014 acquisitions
|
|
|
|
|
6,524
|
|
|
|
|
|
-
|
|
|
|
|
|
6,524
|
|
2013 acquisitions
|
|
|
|
|
17,587
|
|
|
|
|
|
13,555
|
|
|
|
|
|
4,032
|
|
Other facilities
|
|
|
|
|
15,054
|
|
|
|
|
|
11,628
|
|
|
|
|
|
3,426
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income (a)
|
|
|
|
$
|
39,584
|
|
|
|
|
$
|
25,183
|
|
|
|
|
$
|
14,401
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At March 31:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Square foot occupancy:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
|
89.1
|
%
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
2014 acquisitions
|
|
|
|
|
91.8
|
%
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
2013 acquisitions
|
|
|
|
|
92.8
|
%
|
|
|
|
|
86.3
|
%
|
|
|
|
|
7.5
|
%
|
Other facilities
|
|
|
|
|
84.5
|
%
|
|
|
|
|
81.7
|
%
|
|
|
|
|
3.4
|
%
|
|
|
|
|
|
89.6
|
%
|
|
|
|
|
84.4
|
%
|
|
|
|
|
6.2
|
%
|
Annual contract rent per occupied square foot:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
$
|
11.65
|
|
|
|
|
$
|
-
|
|
|
|
|
|
-
|
|
2014 acquisitions
|
|
|
|
|
12.23
|
|
|
|
|
|
-
|
|
|
|
|
|
-
|
|
2013 acquisitions
|
|
|
|
|
14.00
|
|
|
|
|
|
13.25
|
|
|
|
|
|
5.7
|
%
|
Other facilities
|
|
|
|
|
15.89
|
|
|
|
|
|
15.80
|
|
|
|
|
|
0.6
|
%
|
|
|
|
|
$
|
14.26
|
|
|
|
|
$
|
14.26
|
|
|
|
|
|
0.0
|
%
|
Number of facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
|
4
|
|
|
|
|
|
-
|
|
|
|
|
|
4
|
|
2014 acquisitions
|
|
|
|
|
44
|
|
|
|
|
|
-
|
|
|
|
|
|
44
|
|
2013 acquisitions
|
|
|
|
|
121
|
|
|
|
|
|
121
|
|
|
|
|
|
-
|
|
Other facilities
|
|
|
|
|
77
|
|
|
|
|
|
68
|
|
|
|
|
|
9
|
|
|
|
|
|
|
246
|
|
|
|
|
|
189
|
|
|
|
|
|
57
|
|
Net rentable square feet (in thousands):
|
|
|
|
|
|
|
|
|
|
|
2015 acquisitions
|
|
|
|
|
265
|
|
|
|
|
|
-
|
|
|
|
|
|
265
|
|
2014 acquisitions
|
|
|
|
|
3,457
|
|
|
|
|
|
-
|
|
|
|
|
|
3,457
|
|
2013 acquisitions
|
|
|
|
|
8,056
|
|
|
|
|
|
8,036
|
|
|
|
|
|
20
|
|
Other facilities
|
|
|
|
|
6,743
|
|
|
|
|
|
5,630
|
|
|
|
|
|
1,113
|
|
|
|
|
|
|
18,521
|
|
|
|
|
|
13,666
|
|
|
|
|
|
4,855
|
|
(a)
|
|
|
See attached reconciliation of self-storage net operating income
(“NOI”) to operating income.
|
|
|
|
|
|
|
|
|
Investing and Capital Activities
During the three months ended March 31, 2015, we acquired four
self-storage facilities (one each in Florida, North Carolina, Texas and
Washington), with 0.3 million net rentable square feet, for $32.3
million. Subsequent to March 31, 2015, we acquired or were under
contract to acquire seven self-storage facilities (three each in
Colorado and Texas and one in California) with 0.6 million net rentable
square feet for $80 million, and a land lease buyout for $15 million.
During the three months ended March 31, 2015, we completed four newly
developed facilities (0.3 million net rentable square feet) costing
$26.8 million, and various expansion projects costing $4.5 million (0.1
million net rentable square feet). At March 31, 2015 we had various
facilities in development (3.2 million net rentable square feet)
estimated to cost $387 million, and various expansion projects (0.4
million net rentable square feet) estimated to cost $49 million. The
remaining $300 million development costs for these projects is expected
to be incurred in 2015 and 2016.
As previously reported, on March 31, 2015, we amended our revolving
credit agreement which, among other things, i) extends the maturity date
from March 21, 2017 to March 31, 2020, ii) increases the aggregate
borrowing limit from $300 million to $500 million, iii) decreases the
current effective spread over LIBOR from 0.900% to 0.850%, iv) decreases
the current effective quarterly facility fee from 0.125% to 0.080%, and
v) amends various covenants.
During the three months ended March 31, 2015, we called our 6.875%
Series O Preferred Shares for redemption and allocated $4.8 million of
net income to our preferred shareholders pursuant to EITF D-42. The
shares were redeemed on April 15, 2015.
Distributions Declared
On April 29, 2015, our Board of Trustees declared a regular common
quarterly dividend of $1.70 per common share which is an increase of
$0.30 per share, or 21%, over the previous quarter’s distribution. The
Board also declared dividends with respect to our various series of
preferred shares. All the dividends are payable on June 30, 2015 to
shareholders of record as of June 15, 2015.
First Quarter Conference Call
A conference call is scheduled for May 1, 2015 at 9:00 a.m. (PDT) to
discuss the first quarter earnings results. The domestic dial-in number
is (866) 406-5408, and the international dial-in number is (973)
582-2770 (conference ID number for either domestic or international is
21615100). A simultaneous audio webcast may be accessed by using the
link at www.publicstorage.com
under “Company Info, Investor Relations, Upcoming Events.” A replay of
the conference call may be accessed through May 15, 2015 by calling
(800) 585-8367 (domestic) or (404) 537-3406 (international) or by using
the link at www.publicstorage.com
under “Company Info, Investor Relations, Webcasts.” All forms of replay
utilize conference ID number 21615100.
About Public Storage
Public Storage, a member of the S&P 500 and FT Global 500, is a REIT
that primarily acquires, develops, owns and operates self-storage
facilities. The Company’s headquarters are located in Glendale,
California. At March 31, 2015, we had interests in 2,258 self-storage
facilities located in 38 states with approximately 146 million net
rentable square feet in the United States and 193 storage facilities
located in seven Western European nations with approximately ten million
net rentable square feet operated under the “Shurgard” brand. We also
own a 42% common equity interest in PS Business Parks, Inc. (NYSE:PSB)
which owned and operated approximately 28 million rentable square feet
of commercial space at March 31, 2015.
Additional information about Public Storage is available on our website, www.publicstorage.com.
Forward-Looking Statements
All statements in this press release, other than statements of
historical fact, are forward-looking statements which may be identified
by the use of the words “expects,” “believes,” “anticipates,” “should,”
“estimates” and similar expressions. These forward-looking statements
involve known and unknown risks and uncertainties, which may cause our
actual results and performance to be materially different from those
expressed or implied in the forward-looking statements. Factors and
risks that may impact future results and performance are described from
time to time in our filings with the Securities and Exchange Commission,
including in Item 1A, “Risk Factors” in our Annual Report on Form 10-K
for the year ended December 31, 2014, our other Quarterly Reports on
Form 10-Q and current reports on Form 8-K. These risks include, but are
not limited to, the following: general risks associated with the
ownership and operation of real estate, including changes in demand for
our storage facilities, potential liability for environmental
contamination, adverse changes in tax, real estate and zoning laws and
regulations and the impact of natural disasters; risks associated with
downturns in the national and local economies in the markets in which we
operate; the impact of competition from new and existing self-storage
and commercial facilities and other storage alternatives; difficulties
in our ability to successfully evaluate, finance, integrate into our
existing operations and manage acquired and developed properties; risks
related to our development of new properties and/or participation in
joint ventures; risks associated with international operations
including, but not limited to, unfavorable foreign currency rate
fluctuations that could adversely affect our earnings and cash flows;
the impact of the regulatory environment as well as national, state and
local laws and regulations including, without limitation, those
governing REITs and our tenant reinsurance business; risks associated
with a possible failure by us to qualify as a REIT under the Internal
Revenue Code of 1986, as amended; security breaches or a failure of our
networks, systems or technology could adversely impact our business,
customer and employee relationships; changes in federal tax laws related
to the taxation of REITs, which could impact our status as a REIT;
difficulties in raising capital at a reasonable cost; delays in the
development process; ongoing litigation and other legal and regulatory
actions which may divert management’s time and attention, require us to
pay damages and expenses or restrict the operation of our business; and
economic uncertainty due to the impact of war or terrorism. We disclaim
any obligation to update publicly or otherwise revise any
forward-looking statements, whether as a result of new information, new
estimates, or other factors, events or circumstances after the date of
this press release, except where expressly required by law.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PUBLIC STORAGE
SELECTED INCOME STATEMENT DATA
(Amounts in thousands, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Self-storage facilities
|
|
|
|
$
|
530,637
|
|
|
|
|
|
|
|
|
|
$
|
485,587
|
|
Ancillary operations
|
|
|
|
|
38,757
|
|
|
|
|
|
|
|
|
|
|
34,037
|
|
|
|
|
|
|
569,394
|
|
|
|
|
|
|
|
|
|
|
519,624
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Self-storage cost of operations
|
|
|
|
|
161,242
|
|
|
|
|
|
|
|
|
|
|
156,068
|
|
Ancillary cost of operations
|
|
|
|
|
11,920
|
|
|
|
|
|
|
|
|
|
|
18,451
|
|
Depreciation and amortization
|
|
|
|
|
107,146
|
|
|
|
|
|
|
|
|
|
|
109,021
|
|
General and administrative
|
|
|
|
|
24,160
|
|
|
|
|
|
|
|
|
|
|
18,989
|
|
|
|
|
|
|
304,468
|
|
|
|
|
|
|
|
|
|
|
302,529
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
|
|
264,926
|
|
|
|
|
|
|
|
|
|
|
217,095
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other income
|
|
|
|
|
672
|
|
|
|
|
|
|
|
|
|
|
2,402
|
|
Interest expense
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
(3,480
|
)
|
Equity in earnings of unconsolidated real estate entities
|
|
|
|
|
16,184
|
|
|
|
|
|
|
|
|
|
|
14,604
|
|
Gain on real estate sales
|
|
|
|
|
1,472
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Foreign currency exchange loss
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
(2,348
|
)
|
Net income
|
|
|
|
|
283,254
|
|
|
|
|
|
|
|
|
|
|
228,273
|
|
Allocation to noncontrolling interests
|
|
|
|
|
(1,473
|
)
|
|
|
|
|
|
|
|
|
|
(1,077
|
)
|
Net income allocable to Public Storage shareholders
|
|
|
|
|
281,781
|
|
|
|
|
|
|
|
|
|
|
227,196
|
|
Allocation of net income to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred shareholders - distributions
|
|
|
|
|
(63,555
|
)
|
|
|
|
|
|
|
|
|
|
(52,507
|
)
|
Preferred shareholders - redemptions
|
|
|
|
|
(4,784
|
)
|
|
|
|
|
|
|
|
|
|
-
|
|
Restricted share units
|
|
|
|
|
(829
|
)
|
|
|
|
|
|
|
|
|
|
(637
|
)
|
Net income allocable to common shareholders
|
|
|
|
$
|
212,613
|
|
|
|
|
|
|
|
|
|
$
|
174,052
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common share – Basic
|
|
|
|
$
|
1.23
|
|
|
|
|
|
|
|
|
|
$
|
1.01
|
|
Net income per common share – Diluted
|
|
|
|
$
|
1.23
|
|
|
|
|
|
|
|
|
|
$
|
1.01
|
|
Weighted average common shares – Basic
|
|
|
|
|
172,520
|
|
|
|
|
|
|
|
|
|
|
171,910
|
|
Weighted average common shares – Diluted
|
|
|
|
|
173,366
|
|
|
|
|
|
|
|
|
|
|
172,809
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PUBLIC STORAGE
SELECTED BALANCE SHEET DATA
(Amounts in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2015
|
|
|
|
|
|
|
December 31, 2014
|
ASSETS
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
152,797
|
|
|
|
|
|
|
|
$
|
187,712
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating real estate facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land and buildings, at cost
|
|
|
|
|
12,919,875
|
|
|
|
|
|
|
|
|
12,863,235
|
|
Accumulated depreciation
|
|
|
|
|
(4,574,373
|
)
|
|
|
|
|
|
|
|
(4,482,520
|
)
|
|
|
|
|
|
8,345,502
|
|
|
|
|
|
|
|
|
8,380,715
|
|
Construction in process
|
|
|
|
|
135,896
|
|
|
|
|
|
|
|
|
104,573
|
|
Investments in unconsolidated real estate entities
|
|
|
|
|
792,280
|
|
|
|
|
|
|
|
|
813,740
|
|
Goodwill and other intangible assets, net
|
|
|
|
|
221,330
|
|
|
|
|
|
|
|
|
228,632
|
|
Other assets
|
|
|
|
|
124,212
|
|
|
|
|
|
|
|
|
103,304
|
|
Total assets
|
|
|
|
$
|
9,772,017
|
|
|
|
|
|
|
|
$
|
9,818,676
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes payable
|
|
|
|
$
|
58,657
|
|
|
|
|
|
|
|
$
|
64,364
|
|
Preferred shares called for redemption
|
|
|
|
|
145,000
|
|
|
|
|
|
|
|
|
-
|
|
Accrued and other liabilities
|
|
|
|
|
264,439
|
|
|
|
|
|
|
|
|
247,141
|
|
Total liabilities
|
|
|
|
|
468,096
|
|
|
|
|
|
|
|
|
311,505
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Public Storage shareholders’ equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cumulative Preferred Shares, $0.01 par value, 100,000,000 shares
authorized, 167,200 shares issued (in series) and outstanding
(173,000 at December 31, 2014), at liquidation preference
|
|
|
|
|
4,180,000
|
|
|
|
|
|
|
|
|
4,325,000
|
|
Common Shares, $0.10 par value, 650,000,000 shares authorized,
172,594,849 shares issued and outstanding (172,445,554 shares at
December 31, 2014)
|
|
|
|
|
17,260
|
|
|
|
|
|
|
|
|
17,245
|
|
Paid-in capital
|
|
|
|
|
5,558,112
|
|
|
|
|
|
|
|
|
5,561,530
|
|
Accumulated deficit
|
|
|
|
|
(398,905
|
)
|
|
|
|
|
|
|
|
(374,823
|
)
|
Accumulated other comprehensive loss
|
|
|
|
|
(78,572
|
)
|
|
|
|
|
|
|
|
(48,156
|
)
|
Total Public Storage shareholders’ equity
|
|
|
|
|
9,277,895
|
|
|
|
|
|
|
|
|
9,480,796
|
|
Noncontrolling interests
|
|
|
|
|
26,026
|
|
|
|
|
|
|
|
|
26,375
|
|
Total equity
|
|
|
|
|
9,303,921
|
|
|
|
|
|
|
|
|
9,507,171
|
|
Total liabilities and equity
|
|
|
|
$
|
9,772,017
|
|
|
|
|
|
|
|
$
|
9,818,676
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PUBLIC STORAGE
SELECTED FINANCIAL DATA
Computation of Funds from Operations and Funds Available for
Distribution
(Unaudited – amounts in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Computation of FFO per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income allocable to common shareholders
|
|
|
|
$
|
212,613
|
|
|
|
|
|
|
|
|
|
$
|
174,052
|
|
Eliminate items excluded from FFO:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
107,146
|
|
|
|
|
|
|
|
|
|
|
109,021
|
|
Depreciation from unconsolidated real estate investments
|
|
|
|
|
18,781
|
|
|
|
|
|
|
|
|
|
|
19,671
|
|
Depreciation allocated to noncontrolling interests and restricted
share unitholders
|
|
|
|
|
(927
|
)
|
|
|
|
|
|
|
|
|
|
(1,128
|
)
|
Gains on sale of real estate investments, including our equity
share from investments and other
|
|
|
|
|
(6,478
|
)
|
|
|
|
|
|
|
|
|
|
(87
|
)
|
FFO allocable to common shares (a)
|
|
|
|
$
|
331,135
|
|
|
|
|
|
|
|
|
|
$
|
301,529
|
|
Diluted weighted average common shares
|
|
|
|
|
173,366
|
|
|
|
|
|
|
|
|
|
|
172,809
|
|
FFO per share (a)
|
|
|
|
$
|
1.91
|
|
|
|
|
|
|
|
|
|
$
|
1.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Earnings per Share to
FFO per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share - diluted
|
|
|
|
$
|
1.23
|
|
|
|
|
|
|
|
|
|
$
|
1.01
|
|
Eliminate per share amounts excluded from FFO:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization, including amounts from investments
and excluding amounts allocated to noncontrolling interests and
restricted share unitholders
|
|
|
|
|
0.72
|
|
|
|
|
|
|
|
|
|
|
0.74
|
|
Gains on sale of real estate investments, including our equity
share from investments and other
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
|
|
|
|
|
(0.01
|
)
|
FFO per share (a)
|
|
|
|
$
|
1.91
|
|
|
|
|
|
|
|
|
|
$
|
1.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Computation of Funds Available for
Distribution ("FAD"):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO allocable to common shares
|
|
|
|
$
|
331,135
|
|
|
|
|
|
|
|
|
|
$
|
301,529
|
|
Eliminate effect of items included in FFO but not FAD:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash share-based compensation expense
|
|
|
|
|
7,158
|
|
|
|
|
|
|
|
|
|
|
6,287
|
|
Foreign currency exchange loss
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
2,348
|
|
Application of EITF D-42
|
|
|
|
|
4,784
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Less: Capital expenditures to maintain real estate facilities
|
|
|
|
|
(7,899
|
)
|
|
|
|
|
|
|
|
|
|
(13,136
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FAD (a)
|
|
|
|
$
|
335,178
|
|
|
|
|
|
|
|
|
|
$
|
297,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions paid to common shareholders
|
|
|
|
$
|
241,449
|
|
|
|
|
|
|
|
|
|
$
|
240,889
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distribution payout ratio
|
|
|
|
|
72.0
|
%
|
|
|
|
|
|
|
|
|
|
81.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions per common share
|
|
|
|
$
|
1.40
|
|
|
|
|
|
|
|
|
|
$
|
1.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
|
FFO and FFO per share are non-GAAP measures defined by the National
Association of Real Estate Investment Trusts and, along with FAD,
are considered helpful measures of REIT performance by REITs and
many REIT analysts. FFO represents net income before real estate
depreciation, gains or losses and impairment charges, which are
excluded because they are based upon historical real estate costs
and assume that building values diminish ratably over time, while we
believe that real estate values fluctuate due to market conditions.
FAD represents FFO adjusted to exclude certain non-cash charges and
to deduct capital expenditures. FFO and FFO per share are not a
substitute for net income or earnings per share. FFO and FAD are not
substitutes for GAAP net cash flow in evaluating our liquidity or
ability to pay dividends, because they exclude investing and
financing activities presented on our statements of cash flows. In
addition, other REITs may compute these measures differently, so
comparisons among REITs may not be helpful.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PUBLIC STORAGE
SELECTED FINANCIAL DATA
Reconciliation of Self-Storage Net Operating Income to
Operating Income
(Unaudited – amounts in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Self-storage revenues for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same Store Facilities
|
|
|
|
$
|
472,320
|
|
|
|
|
|
|
|
|
|
$
|
445,267
|
|
Non Same Store Facilities
|
|
|
|
|
58,317
|
|
|
|
|
|
|
|
|
|
|
40,320
|
|
Self-storage revenues
|
|
|
|
|
530,637
|
|
|
|
|
|
|
|
|
|
|
485,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Self-storage cost of operations for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same Store Facilities
|
|
|
|
|
142,509
|
|
|
|
|
|
|
|
|
|
|
140,931
|
|
Non Same Store Facilities
|
|
|
|
|
18,733
|
|
|
|
|
|
|
|
|
|
|
15,137
|
|
Self-storage cost of operations
|
|
|
|
|
161,242
|
|
|
|
|
|
|
|
|
|
|
156,068
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Self-storage net operating income for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same Store Facilities
|
|
|
|
|
329,811
|
|
|
|
|
|
|
|
|
|
|
304,336
|
|
Non Same Store Facilities
|
|
|
|
|
39,584
|
|
|
|
|
|
|
|
|
|
|
25,183
|
|
Self-storage net operating income (a)
|
|
|
|
|
369,395
|
|
|
|
|
|
|
|
|
|
|
329,519
|
|
Ancillary operating revenues
|
|
|
|
|
38,757
|
|
|
|
|
|
|
|
|
|
|
34,037
|
|
Ancillary cost of operations
|
|
|
|
|
(11,920
|
)
|
|
|
|
|
|
|
|
|
|
(18,451
|
)
|
Depreciation and amortization
|
|
|
|
|
(107,146
|
)
|
|
|
|
|
|
|
|
|
|
(109,021
|
)
|
General and administrative expense
|
|
|
|
|
(24,160
|
)
|
|
|
|
|
|
|
|
|
|
(18,989
|
)
|
Operating income on our income statement
|
|
|
|
$
|
264,926
|
|
|
|
|
|
|
|
|
|
$
|
217,095
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
|
Net operating income or “NOI” is a non-GAAP financial measure that
excludes the impact of depreciation and amortization expense. We
believe that NOI is a meaningful measure of operating performance,
because we utilize NOI in making decisions with respect to capital
allocations, in determining current property values, in evaluating
property performance and in comparing period-to-period and
market-to-market property operating results. In addition, we believe
the investment community utilizes NOI in determining operating
performance and real estate values, and does not consider
depreciation expense because it is based upon historical cost. NOI
is not a substitute for net income, net operating cash flow, or
other related GAAP financial measures, in evaluating our operating
results. This table reconciles from NOI for our self-storage
facilities to the operating income presented on our income statement.
|
|
|
|
|
Copyright Business Wire 2015