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June 8, 2009
Forest City Posts Smaller 1Q Loss; Occupancy Rates Down
Dow Jones Newswires via WSJ.com
Buffeted by the New Jersey Nets' $13-and-a-half million quarterly operating loss, Forest City Enterprises lost more money in the last quarter than Wall Street analysts expected them to — though not quite as much as they lost a year ago.
Forest City Enterprises Inc. (FCEB) reported a narrower fiscal first-quarter loss as the real-estate investment trust posted weaker-than-expected results amid largely weaker occupancy rates.
...For the quarter ended April 30, Forest City reported a loss of $30.7 million, or 30 cents a share, compared with a prior-year loss of $40.4 million, or 39 cents a share. The bottom line benefited from reduced project write-offs and increased rental-property income, but that was partially offset by $8.7 million in job-cut charges and $10.7 million in other write-downs.
Revenue rose 2.6% to $313 million.
The mean estimates of analysts surveyed by Thomson Reuters were for a 17-cent per share loss on revenue of $346 million.
Here's the official Forest City press release. CEO Chuck Ratner is not too bullish on the near-future for his line of business:
"As we have stated now for several quarters, we continue to be cautious in our outlook," Ratner said. "While we believe efforts to stimulate the economy will have a beneficial impact over time, we see no measureable improvement in current conditions, and we believe the recession will continue to deepen, particularly for real estate, before the economy turns around. As a result, we expect to see continued softness in fundamentals, particularly in retail and, to a lesser degree, in residential."
However, he's gung-ho about Forest City's "great" Atlantic Yards project:
"In mid-May, a significant legal victory was achieved for the Company's Atlantic Yards project in Brooklyn, when the Appellate Division, Second Department, unanimously upheld New York State's right to use eminent domain to acquire property at the site, given the significant public benefit associated with the project. This was an important win and affirmation for Atlantic Yards, and effectively removes one of the few remaining obstacles to moving forward with this great project."
More coverage...
Cleveland Plain Dealer, Forest City says losses narrowed, EBDT rose in first quarter
Executives at Forest City and Forest City Ratner Cos., the company's New York arm, also have said they plan to break ground this year for a new arena in Brooklyn for the New Jersey Nets. The arena is part of the company's much-delayed Atlantic Yards project. Last week, Forest City announced that architect Frank Gehry will not longer design the arena. Gehry, the master-planner for Atlantic Yards, has been replaced with architectural firm Ellerbe Becket, which has designed sports facilities including Quicken Loans Arena.
As of right now, Wall Street appears unimpressed by Forest City's results: shares are trading down 25 cents, or 3.52%.
Posted by eric at June 8, 2009 12:05 PM