Shed developer ProLogis today revealed the impact of the global credit crunch on its business by reporting an 85% slump in its cashflow last year.
Funds from operations – the measure used by US REITs to measure performance and cashflow – fell in 2008 to $0.68 a share, compared with $4.61 in 2007, according to the developer’s full year results.
This figure takes into account one off costs incurred by the developer, which also reported a net loss of $1.65 a share in 2008.
If these impairment costs are not taken into account, funds from operations excluding significant non-cash items were $3.68 a diluted share for 2008 compared with $4.61 a share in 2007.
New chief executive officer Walt Rakowich said: ‘After a thorough review of the assets on our balance sheet and in our unconsolidated investees, we recognized impairment charges where appropriate, given the current economic climate and our long-term intent for the properties.
'Excluding these adjustments, our results were in line with expectations, and these non-cash charges do not affect our liquidity or our conviction in the long-term value of our global portfolio.’
The company has already put development on hold and sold its operations in China and fund interests in Japan to shore up its balance sheet.
Its shares were at $10.16, up slightly following the results.