Simon Property 1Q FFO Improves, Dividend Is Cut

INDIANAPOLIS (AP) — Simon Property Group Inc. said Friday that its first-quarter funds from operations improved, but the largest shopping mall owner and operator in the U.S. cut its quarterly dividend 33 percent.

The real estate investment trust also lowered its 2009 FFO outlook, citing recent common stock and unsecured debt offerings that were not previously accounted for.

The company's stock dropped $2.61, or 5.1 percent, to $48.99 in midday trading. The stock has traded in a range of $24.27 to $106.43 over the last year.

Funds from operations, or FFO, climbed to $476.8 million, or $1.61 per share. That's up from $420.1 million, or $1.46 per share, a year earlier.

Funds from operations, a widely used gauge of real estate operating performance, adds depreciation and amortization expenses, as well as other non-operating items, to net income.

Analysts polled by Thomson Reuters forecast FFO of $1.48 per share.

The REIT also reduced its quarterly dividend to 60 cents from 90 cents. It will pay the quarterly dividend on June 19 to shareholders of record May 14.

Net income available to common shareholders for the period ended March 31 rose to $106.8 million, or 45 cents per share, compared with $87.9 million, or 39 cents per share, in the prior year.

Revenue grew to $918.5 million from $895.3 million as minimum rent improved.

Average rent per square foot increased at both regional malls and premium outlet centers during the quarter.