Commenting on Q2 2017 financial report, David R. Lukes, the CEO and President of DDR Corp (NYSE:DDR), reported that their second quarter financial performance was characterized by strong operational and financial execution. They recorded progress lengthening their average debt maturity and reducing leverage by accessing the capital markets and selling assets.
The operations were well ahead of plan and they closed their portfolio review and strategic planning procedure over a shorter time-period. Lukes added that he is thrilled about continuing to implement on these strategies, which should position the firm for robust future growth.
DDR reported that net income in Q2 2017 came at $23.2 million, as against net income of $35.5 million, in the year ago-period. The YOY drop in net income is mainly attributable to impairment expenses aggregating $28.1 million registered on a shopping center and 2 parcels of undeveloped property.
Operating FFO was $108.8 million in the Q2 2017 compared to $122.4 million in the year ago-period. The YoY decline in OFFO is mainly attributable to the dilutive bearing of deleveraging asset sales. DDR recorded total asset sales and loan settlement proceeds of $237.5 million. It also sold 2 shopping centers in Puerto Rico in a deal worth $57.3 million. The company offered 9 shopping centers in the United States for a total sales price of $149.2 million.
During the second quarter, same store net operating income, declined 0.1% on a pro rata basis; however, discounting Puerto Rico, it came flat on a pro rata basis. DDR generated renewal leasing spreads of over5% and new leasing spreads of 10%, on a pro rata basis as well as including Puerto Rico for Q2 2017. Portfolio leased rate stood at 93.7% as of the close of June 2017 as against 96.1% in the same period, a year earlier, on a pro rata basis.