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Public Storage Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: August 8, 2011 06:16AM

Public Storage Inc. (PSA) filed Quarterly Report for the period ended 2011-06-30. Public Storage has a market cap of $18.82 billion; its shares were traded at around $110.82 with a P/E ratio of 19.39 and P/S ratio of 11.43. The dividend yield of Public Storage stocks is 3.44%. Public Storage had an annual average earning growth of 5.7% over the past 10 years. GuruFocus rated Public Storage the business predictability rank of 4.5-star.



Highlight of Business Operations:

Another important component of our long-term growth is our access to capital and deployment of that capital. During the year ended December 31, 2010, we acquired 42 self-storage facilities for $239.6 million. During the six months ended June 30, 2011, we acquired six additional facilities for $37.5 million, comprised of $27.8 million in cash and $9.7 million in assumed mortgage debt. In February 2011, we acquired the leasehold interest in the land for one of our existing self-storage facilities for approximately $6.6 million. On June 30, 2011, we acquired limited and general partner interests from the Hughes Family for an aggregate of approximately $13.3 million.

At June 30, 2011, we had approximately $144.5 million of cash and we have access to our $300 million line of credit which expires March 27, 2012. On July 26, 2011, we raised approximately $487.5 million in gross proceeds from the issuance of preferred securities. We also expect to receive approximately $116 million from PSB for the repayment of a loan due on August 9, 2011. Based upon our capital commitments and completed transactions at August 5, 2011, our uses of capital for the last six months of 2011 total approximately $608.3 million and include (i) $5.9 million in principal payments on debt, (ii) $23.3 million for the acquisition of two self-storage facilities discussed above, (iii) $154.3 million to acquire all of the units of limited partnership interest and general partnership interests we do not currently own in the five Partnerships described under "Liquidity and Capital Resources - Acquisition and Development Activities", and (iv) $424.8 million for the redemption of our Series K Cumulative Preferred Shares. We have no further significant commitments until 2013, when $266.0 million of existing debt comes due.

For the three months ended June 30, 2011, net income allocable to our common shareholders was $131.5 million or $0.77 per diluted common share, compared to $60.8 million or $0.36 per diluted common share for the same period in 2010, representing an increase of $70.7 million or $0.41 per diluted common share. This increase is due to (i) a foreign currency exchange gain of $10.5 million during the quarter ended June 30, 2011 as compared to a loss of $49.2 million for the same period in 2010, (ii) improved operations of our Same Store Facilities (discussed below) and our non same store facilities and (iii) increased equity in earnings and interest and other income from Shurgard Europe, due primarily to Shurgard Europe s acquisition of its joint venture partner s interests on March 2, 2011 (discussed below), partially offset by a $9.8 million increase in Emerging Issues Task Force D-42 (“EITF D-42”) charges related to the redemption of our preferred securities, including our equity share from PSB.

For the six months ended June 30, 2011, net income allocable to our common shareholders was $279.6 million or $1.64 per diluted common share, compared to $95.6 million or $0.56 per diluted common share for the same period in 2010, representing an increase of $184.0 million or $1.08 per diluted common share. This increase is due to (i) a foreign currency exchange gain of $41.7 million during the six months ended June 30, 2011 as compared to a loss of $84.0 million for the same period in 2010, (ii) improved operations of our Same Store Facilities (discussed below) and our non same store facilities, (iii) increased equity in earnings and interest and other income from Shurgard Europe, due primarily to Shurgard Europe s acquisition of its joint venture partner s interests on March 2, 2011 (discussed below) and (iv) a $19.0 million reduction in EITF D-42 charges related to the redemption of our equity securities, including our equity share from PSB.

For the three months ended June 30, 2011, FFO was impacted by (i) a foreign currency exchange gain of $10.5 million (compared to a loss of $49.2 million for the same period in 2010), (ii) a $15.9 million charge related to our redemption of preferred shares in applying EITF D-42 (compared to a $6.1 million charge for the same period in 2010, including our equity share from PSB) and (iii) incremental general and administrative expenses associated with the acquisition of real estate facilities totaling $0.9 million (compared to $1.6 million for the same period in 2010).

For the six months ended June 30, 2011, FFO was impacted by (i) a foreign currency exchange gain of $41.7 million (compared to a loss of $84.0 million for the same period in 2010), (ii) a $12.9 million net charge related to our redemptions of preferred shares, including our equity share from PSB, in applying EITF D-42 (compared to $31.9 million due to our redemptions of preferred shares, including our equity share from PSB, and our redemption of our Equity Shares, Series A for the same period in 2010) and (iii) incremental general and administrative expense associated with the acquisition of real estate facilities totaling $1.1 million (compared to $1.6 million for the same period in 2010).

Read the The complete Report



Stocks Discussed: PSA,
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