HCP Inc.
(HCP), a health care real estate investment trust (REIT), reported first quarter 2010 FFO (funds from operations) of $158.7 million or 54 cents per share, compared with $128.0 million or 50 cents per share in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
 
The quarterly FFO figures included a non-recurring income (from impairment recoveries) of $11.9 million or 4 cents per share. Excluding the one-time charges, FFO for the first quarter of 2010 was $146.8 million or 50 cents per share.
 
HCP reported total revenues of $295.9 million during the quarter compared with $277.0 million in the year-ago period. During the quarter, HCP invested $27 million for construction and other capital projects primarily in the life science segment, and about $9 million for acquisition of a senior housing facility.
 
During the quarter, the company placed in service three life science facilities in South San Francisco, spanning 329,000 square feet of space. At quarter end, HCP had six redevelopment properties under construction, primarily in California, for an estimated total investment of $210.6 million. In addition, the company also had approximately 149 acres of land for future development.
 
During the quarter, HCP repaid a term loan of $200 million, utilizing the funds available under its revolving credit facility. At quarter end, the company had cash and cash equivalents of $44.6 million. During the quarter, HCP reduced its financial leverage from 47.9% in the year-earlier quarter to 43.5%.
 
For full year 2010, HCP expects FFO before non-recurring items in the range of $2.11 to $2.17 per share.

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