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Jun 30, 2021
Vornado Q2 2021 Earnings Report
Vornado's financial performance improved in Q2 2021 compared to the previous year, with a significant increase in net income and adjusted FFO.
Key Takeaways
Vornado Realty Trust reported a net income attributable to common shareholders of $48.0 million, or $0.25 per diluted share, for the quarter ended June 30, 2021, compared to a net loss of $197.8 million, or $1.03 per diluted share, for the prior year's quarter. The company's FFO attributable to common shareholders plus assumed conversions was $153.4 million, or $0.80 per diluted share, compared to $203.3 million, or $1.06 per diluted share, for the prior year's quarter. Adjusted FFO increased to $133.2 million, or $0.69 per diluted share, from $107.4 million, or $0.56 per diluted share, in the prior year's quarter.
Net income attributable to common shareholders was $48.0 million, or $0.25 per diluted share, a significant improvement compared to the prior year's net loss.
FFO attributable to common shareholders plus assumed conversions was $153.4 million, or $0.80 per diluted share.
Adjusted FFO increased to $133.2 million, or $0.69 per diluted share, driven by tenant-related items, reduced general and administrative expenses, and improved performance in variable businesses.
The company completed several financing activities, including refinancing of One Park Avenue and 555 California Street, and issued senior unsecured notes.
Vornado
Vornado
Vornado Revenue by Geographic Location
Revenue by Geographic Location
New York Revenue
CapyFin.com Forward Guidance
The company expects to complete the purchase of One Park Avenue in the third quarter of 2021 and anticipates the closing of the sale of the Paramus, New Jersey property in the fourth quarter of 2021.
Positive Outlook
- Resumption of trade shows at theMART expected in the third quarter of 2021.
- Acquisition of remaining ownership interest in One Park Avenue is expected to be completed in Q3 2021.
- Sale of Paramus, New Jersey property is anticipated to close in Q4 2021.
- Refinancing activities have resulted in lower interest rates and extended maturities.
- Leasing activity shows positive trends in mark-to-market rents in certain segments.
Challenges Ahead
- The COVID-19 pandemic continues to adversely affect the company's business, financial condition, and operating results.
- Lower rental income and potentially lower occupancy levels at properties may result in less cash flow.
- The value of real estate assets may decline, leading to non-cash impairment charges.
- Economic conditions and limitations on international travel continue to affect the financial health of retail tenants.
- Uncertainty remains regarding the duration of the pandemic, current and future variants, the efficacy and durability of vaccines against the variants and the potential for increased government restrictions.