Parkway Properties says FFO dropped in 4Q; gives outlook, cuts dividend

Parkway Properties FFO drops in 4Q

JACKSON, Miss. — Parkway Properties Inc. said Monday its fourth-quarter funds from operations dropped 33 percent as the office property owner wrote down the value of some of its holdings by $8.8 million.

The company also forecast the key figure would fall for 2010, and it cut its dividend.

The real estate investment trust said funds from operations, or FFO, available to common shareholders was $7.7 million, or 36 cents per share, compared with $11.6 million, or 77 cents per share, in the fourth quarter of 2008.

FFO, which adds items such as amortization and depreciation back to net income, is considered a key measure of REIT strength.

Total revenue was flat at $65.9 million.

Recurring FFO for the quarter was $15.7 million, or 73 cents per share, compared with $15.2 million, or $1.01 per share, a year earlier.

Analysts polled by Thomson Reuters expected FFO of 67 cents per share on revenue of $65.6 million.

Parkway’s net loss in the quarter was $11.4 million, or 53 cents per share, compared with a net loss of $7.1 million, or 47 cents per share, in the fourth quarter of 2008.

The company reported non-cash charges $8.8 million, or 45 cents per share, related to the value of investments with joint venture partner Rubicon U.S. REIT. Rubicon filed for Chapter 11 bankruptcy court protection last month.

Parkway’s shares fell 50 cents to $19.95.

For the full year, its FFO was $56.6 million, or $2.91 per share, compared with $55.6 million, or $3.67 per share, in 2008. Full-year revenue was $268.2 million, compared with $265.4 million in 2008.

Recurring FFO for 2009 was $63.4 million, or $3.27 per share, compared with $59 million, or $3.90 per share, the year before.

Net loss for the year was $16.4 million, or 85 cents per share, compared with net income of $4.5 million, or 30 cents per share, for 2008.

Analysts polled by Thomson Reuters expected FFO of $3.28 per share.

Parkway, based in Jackson, Miss., estimated this year it will have FFO per share of $2.72 to $2.92. It forecast recurring FFO per share of $2.40 to $2.60. Analysts expect full-year FFO of $2.58 per share.

Also, the company said it cut its annual common stock dividend to about 30 cents per share from 33 cents per share, partly due to increased costs.