UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

T

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2015

 

£

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ______________

 

Commission File Number:  001-13545 (Prologis, Inc.)  001-14245 (Prologis, L.P.)

 

Prologis, Inc.

Prologis, L.P.

(Exact name of registrant as specified in its charter)

 

Maryland (Prologis, Inc.)

Delaware (Prologis, L.P.)

 

94-3281941 (Prologis, Inc.)

94-3285362 (Prologis, L.P.)

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

Pier 1, Bay 1, San Francisco, California

 

94111

(Address or principal executive offices)

 

(Zip Code)

 

(415) 394-9000

(Registrants’ telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing for the past 90 days.

Prologis, Inc.

Yes

T

No

£

Prologis, L.P.

Yes

T

No

£

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website; if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter periods that the registrant was required to submit and post such files).

Prologis, Inc.

Yes

T

No

£

Prologis, L.P.

Yes

T

No

£

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):

 

Prologis, Inc.:

 

 

 

 

Large accelerated filer   T

 

Accelerated filer   £

Non-accelerated filer   £

Smaller reporting company   £

 

 

(Do not check if a smaller reporting  company)

 

 

Prologis, L.P.:

 

 

 

 

Large accelerated filer   £

 

Accelerated filer   £

Non-accelerated filer   T

Smaller reporting company   £

 

 

(Do not check if a smaller reporting  company)

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).

Prologis, Inc.

Yes

£

No

T

Prologis, L.P.

Yes

£

No

T

 

The number of shares of Prologis, Inc.’s common stock outstanding as of April 27, 2015, was approximately 524,047,000.

 

 

 

 


 

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the period ended March 31, 2015, of Prologis, Inc. and Prologis, L.P. Unless stated otherwise or the context otherwise requires, references to “Prologis, Inc.” or the “Parent” mean Prologis, Inc. and its consolidated subsidiaries; and references to “Prologis, L.P.” or the “Operating Partnership” mean Prologis, L.P., and its consolidated subsidiaries. The terms “the Company,” “Prologis,” “we,” “our” or “us” means Prologis, Inc. and the Operating Partnership collectively.

Prologis, Inc. is a real estate investment trust (a “REIT”) and the general partner of the Operating Partnership. At March 31, 2015, Prologis, Inc. owned an approximate 99.62% common general partnership interest in the Operating Partnership and 100% of the preferred units in the Operating Partnership. The remaining approximate 0.38% common limited partnership interests are owned by non-affiliated investors and certain current and former directors and officers of Prologis, Inc. As the sole general partner of the Operating Partnership, Prologis, Inc. has full, exclusive and complete responsibility and discretion in the day-to-day management and control of the Operating Partnership.

We operate Prologis, Inc. and the Operating Partnership as one enterprise. The management of Prologis, Inc. consists of the same members as the management of the Operating Partnership. These members are officers of Prologis, Inc. and employees of the Operating Partnership or one of its subsidiaries. As general partner with control of the Operating Partnership, Prologis, Inc. consolidates the Operating Partnership for financial reporting purposes. Since the only significant asset of Prologis, Inc. is its investment in the Operating Partnership, the assets and liabilities of Prologis, Inc. and the Operating Partnership are the same on their respective financial statements.

We believe combining the quarterly reports on Form 10-Q of Prologis, Inc. and the Operating Partnership into this single report results in the following benefits:

·

enhances investors’ understanding of Prologis, Inc. and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

·

eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the Company’s disclosure applies to both Prologis, Inc. and the Operating Partnership; and

·

creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

We believe it is important to understand the few differences between Prologis, Inc. and the Operating Partnership in the context of how we operate the Company. Prologis, Inc. does not conduct business itself, other than acting as the sole general partner of the Operating Partnership and issuing public equity from time to time. Prologis, Inc. itself does not incur any indebtedness, but guarantees the unsecured debt of the Operating Partnership. The Operating Partnership holds substantially all the assets of the business, directly or indirectly, and holds the ownership interests in the Company’s investment in certain entities. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by Prologis, Inc., which are contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates capital required by the business through the Operating Partnership’s operations, incurrence of indebtedness and issuance of partnership units to third parties.

Noncontrolling interests, stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of Prologis, Inc. and those of the Operating Partnership. The noncontrolling interests in the Operating Partnership’s financial statements include the interests in consolidated entities not owned by the Operating Partnership. The noncontrolling interests in Prologis, Inc.’s financial statements include the same noncontrolling interests at the Operating Partnership level, as well as the common limited partnership interests in the Operating Partnership, not owned by Prologis, Inc., which are accounted for as partners’ capital by the Operating Partnership.

In order to highlight the differences between Prologis, Inc. and the Operating Partnership, there are separate sections in this report, as applicable, that separately discuss Prologis, Inc. and the Operating Partnership, including separate financial statements and separate Exhibit 31 and 32 certifications. In the sections that combine disclosure of Prologis, Inc. and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of Prologis.

 

 

 

 


 

PROLOGIS

INDEX

 

 

 

 

 

Page

Number

 

PART I.

 

Financial Information

 

 

 

 

 

Item 1.

Financial Statements

 

 

 

 

 

            Prologis, Inc.:

 

 

 

 

 

 

Consolidated Balance Sheets – March 31, 2015 and December 31, 2014

 

1

 

 

 

 

Consolidated Statements of Operations – Three Months Ended March 31, 2015 and 2014

 

2

 

 

 

 

Consolidated Statements of Comprehensive Income (Loss) – Three Months Ended March 31, 2015 and 2014

 

3

 

 

 

 

Consolidated Statement of Equity – Three Months Ended March 31, 2015

 

3

 

 

 

 

Consolidated Statements of Cash Flows – Three Months Ended March 31, 2015 and 2014

 

4

 

 

 

            Prologis, L.P.:

 

 

 

 

 

 

Consolidated Balance Sheets – March 31, 2015 and December 31, 2014

 

5

 

 

 

 

Consolidated Statements of Operations – Three Months Ended March 31, 2015 and 2014

 

6

 

 

 

 

Consolidated Statements of Comprehensive Income (Loss) – Three Months Ended March  31, 2015  and 2014

 

7

 

 

 

 

Consolidated Statement of Capital – Three Months Ended March 31, 2015

 

7

 

 

 

 

Consolidated Statements of Cash Flows – Three Months Ended March 31, 2015 and 2014

 

8

 

 

 

            Prologis, Inc. and Prologis, L.P.:

 

 

 

 

 

 

Notes to Consolidated Financial Statements

 

9

 

 

 

 

Reports of Independent Registered Public Accounting Firm

 

24

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

26

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

37

 

 

 

Item 4.

Controls and Procedures

 

38

 

PART II.

 

Other Information

 

 

 

 

 

Item 1.

Legal Proceedings

 

38

 

 

 

Item 1A.

Risk Factors

 

38

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

38

 

 

 

Item 3.

Defaults Upon Senior Securities

 

38

 

 

 

Item 4.

Mine Safety Disclosures

 

38

 

 

 

Item 5.

Other Information

 

38

 

 

 

Item 6.

Exhibits

 

38

 

 

 

 

 

 


 

PROLOGIS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

 

 

March 31,

 

 

 

 

 

 

2015

 

 

December 31,

 

 

(Unaudited)

 

 

2014

 

ASSETS

 

 

 

 

 

 

 

Investments in real estate properties

$

21,800,499

 

 

$

22,190,145

 

Less accumulated depreciation

 

2,877,478

 

 

 

2,790,781

 

Net investments in real estate properties

 

18,923,021

 

 

 

19,399,364

 

Investments in and advances to unconsolidated entities

 

4,559,721

 

 

 

4,824,724

 

Assets held for sale

 

337,229

 

 

 

43,934

 

Note receivable backed by real estate

 

197,500

 

 

 

-

 

Net investments in real estate

 

24,017,471

 

 

 

24,268,022

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

192,013

 

 

 

350,692

 

Other assets

 

1,251,337

 

 

 

1,199,509

 

Total assets

$

25,460,821

 

 

$

25,818,223

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

Debt

$

8,641,421

 

 

$

9,380,199

 

Accounts payable and accrued expenses

 

459,845

 

 

 

627,999

 

Other liabilities

 

566,748

 

 

 

626,426

 

Total liabilities

 

9,668,014

 

 

 

10,634,624

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

Prologis, Inc. stockholders' equity:

 

 

 

 

 

 

 

Series Q preferred stock at stated liquidation preference of $50 per share; $0.01 par value; 1,565 shares issued and

     outstanding and 100,000 preferred shares authorized at March 31, 2015 and December 31, 2014

 

78,235

 

 

 

78,235

 

Common stock; $0.01 par value; 524,037 shares and 509,498 shares issued and outstanding at March 31,

     2015 and December 31, 2014, respectively

 

5,240

 

 

 

5,095

 

Additional paid-in capital

 

19,052,562

 

 

 

18,467,009

 

Accumulated other comprehensive loss

 

(701,713

)

 

 

(600,337

)

Distributions in excess of net earnings

 

(3,819,351

)

 

 

(3,974,493

)

Total Prologis, Inc. stockholders' equity

 

14,614,973

 

 

 

13,975,509

 

Noncontrolling interests

 

1,177,834

 

 

 

1,208,090

 

Total equity

 

15,792,807

 

 

 

15,183,599

 

Total liabilities and equity

$

25,460,821

 

 

$

25,818,223

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

1

 


 

PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

 

2014

 

Revenues:

 

 

 

 

 

 

 

 

Rental income

 

$

324,547

 

 

$

300,878

 

Rental recoveries

 

 

94,255

 

 

 

87,362

 

Strategic capital income

 

 

42,025

 

 

 

45,310

 

Development management and other income

 

 

2,020

 

 

 

1,132

 

Total revenues

 

 

462,847

 

 

 

434,682

 

Expenses:

 

 

 

 

 

 

 

 

Rental expenses

 

 

126,934

 

 

 

110,517

 

Strategic capital expenses

 

 

20,361

 

 

 

24,163

 

General and administrative expenses

 

 

56,288

 

 

 

63,203

 

Depreciation and amortization

 

 

169,808

 

 

 

160,280

 

Other expenses

 

 

5,575

 

 

 

5,053

 

Total expenses

 

 

378,966

 

 

 

363,216

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

83,881

 

 

 

71,466

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Earnings from unconsolidated entities, net

 

 

31,042

 

 

 

29,746

 

Interest expense

 

 

(68,761

)

 

 

(85,523

)

Interest and other income, net

 

 

11,049

 

 

 

14,050

 

Gains on dispositions of investments in real estate, net

 

 

277,715

 

 

 

17,055

 

Foreign currency and derivative gains (losses) and related amortization, net

 

 

34,566

 

 

 

(28,184

)

Gains (losses) on early extinguishment of debt, net

 

 

(16,289

)

 

 

273

 

Total other income (expense)

 

 

269,322

 

 

 

(52,583

)

Earnings before income taxes

 

 

353,203

 

 

 

18,883

 

Current income tax expense

 

 

839

 

 

 

5,848

 

Deferred income tax expense

 

 

1,052

 

 

 

1,032

 

Total income tax expense

 

 

1,891

 

 

 

6,880

 

Consolidated net earnings

 

 

351,312

 

 

 

12,003

 

Net earnings attributable to noncontrolling interests

 

 

(4,436

)

 

 

(5,202

)

Net earnings attributable to controlling interests

 

 

346,876

 

 

 

6,801

 

Less preferred stock dividends

 

 

1,670

 

 

 

2,135

 

Net earnings attributable to common stockholders

 

$

345,206

 

 

$

4,666

 

Weighted average common shares outstanding - Basic

 

 

514,022

 

 

 

498,696

 

Weighted average common shares outstanding - Diluted

 

 

529,022

 

 

 

504,373

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to common stockholders - Basic

 

$

0.67

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to common stockholders - Diluted

 

$

0.65

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

Dividends per common share

 

$

0.36

 

 

$

0.33

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

2

 


 

PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In thousands)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

 

2014

 

Consolidated net earnings

 

$

351,312

 

 

$

12,003

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

Foreign currency translation losses, net

 

 

(124,279

)

 

 

(4,723

)

Unrealized gains (losses) and amortization on derivative contracts, net

 

 

3,809

 

 

 

(1,261

)

Comprehensive income

 

 

230,842

 

 

 

6,019

 

Net earnings attributable to noncontrolling interests

 

 

(4,436

)

 

 

(5,202

)

Other comprehensive loss (income) attributable to noncontrolling interest

 

 

19,094

 

 

 

(2,935

)

Comprehensive income (loss) attributable to common stockholders

 

$

245,500

 

 

$

(2,118

)

 

 

 

PROLOGIS, INC.

CONSOLIDATED STATEMENT OF EQUITY

Three Months Ended March 31, 2015

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

Common Stock

 

 

 

 

 

 

Accumulated

 

 

Distributions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number

 

 

 

 

 

 

Additional

 

 

Other

 

 

in Excess of

 

 

Non-

 

 

 

 

 

 

 

Preferred

 

 

of

 

 

Par

 

 

Paid-in

 

 

Comprehensive

 

 

Net

 

 

controlling

 

 

Total

 

 

 

Stock

 

 

Shares

 

 

Value

 

 

Capital

 

 

Income (Loss)

 

 

Earnings

 

 

interests

 

 

Equity

 

Balance at January 1, 2015

 

$

78,235

 

 

 

509,498

 

 

$

5,095

 

 

$

18,467,009

 

 

$

(600,337

)

 

$

(3,974,493

)

 

$

1,208,090

 

 

$

15,183,599

 

Consolidated net earnings

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

346,876

 

 

 

4,436

 

 

 

351,312

 

Effect of equity compensation plans

 

 

-

 

 

 

1,000

 

 

 

10

 

 

 

4,965

 

 

 

-

 

 

 

-

 

 

 

11,939

 

 

 

16,914

 

Issuance of stock in at-the-market

     program, net of issuance costs

 

 

-

 

 

 

1,662

 

 

 

16

 

 

 

71,762

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

71,778

 

Issuance of stock upon conversion of

     exchangeable debt

 

 

-

 

 

 

11,872

 

 

 

119

 

 

 

502,613

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

502,732

 

Capital contributions

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

229

 

 

 

229

 

Foreign currency translation losses, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(105,170

)

 

 

-

 

 

 

(19,109

)

 

 

(124,279

)

Unrealized gains and amortization

     on derivative contracts, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,794

 

 

 

-

 

 

 

15

 

 

 

3,809

 

Distributions, allocations and other

 

 

-

 

 

 

5

 

 

 

-

 

 

 

6,213

 

 

 

-

 

 

 

(191,734

)

 

 

(27,766

)

 

 

(213,287

)

Balance at March 31, 2015

 

$

78,235

 

 

 

524,037

 

 

$

5,240

 

 

$

19,052,562

 

 

$

(701,713

)

 

$

(3,819,351

)

 

$

1,177,834

 

 

$

15,792,807

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

3

 


 

PROLOGIS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

 

2014

 

Operating activities:

 

 

 

 

 

 

 

 

Consolidated net earnings

 

$

351,312

 

 

$

12,003

 

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Straight-lined rents

 

 

(10,685

)

 

 

(13,066

)

Equity-based compensation awards

 

 

13,234

 

 

 

15,238

 

Depreciation and amortization

 

 

169,808

 

 

 

160,280

 

Earnings from unconsolidated entities, net

 

 

(31,042

)

 

 

(29,746

)

Distributions and net changes in operating receivables from unconsolidated entities

 

 

24,716

 

 

 

26,025

 

Amortization of debt and lease intangibles

 

 

(566

)

 

 

5,326

 

Gains on dispositions of investments in real estate, net

 

 

(277,715

)

 

 

(17,055

)

Losses (gains) on early extinguishment of debt, net

 

 

16,289

 

 

 

(273

)

Unrealized foreign currency and derivative losses (gains) and related amortization, net

 

 

(32,860

)

 

 

27,828

 

Deferred income tax expense

 

 

1,052

 

 

 

1,032

 

Increase in accounts receivable and other assets

 

 

(28,673

)

 

 

(54,819

)

Decrease in accounts payable and accrued expenses and other liabilities

 

 

(113,338

)

 

 

(60,530

)

Net cash provided by operating activities

 

 

81,532

 

 

 

72,243

 

Investing activities:

 

 

 

 

 

 

 

 

Real estate development activity

 

 

(335,959

)

 

 

(244,268

)

Real estate acquisitions

 

 

(68,844

)

 

 

(77,307

)

Tenant improvements and lease commissions on previously leased space

 

 

(30,800

)

 

 

(33,346

)

Non-development capital expenditures

 

 

(11,602

)

 

 

(7,576

)

Proceeds from dispositions and contributions of real estate properties

 

 

325,830

 

 

 

81,231

 

Investments in and advances to unconsolidated entities

 

 

(123,689

)

 

 

(328,321

)

Return of investment from unconsolidated entities

 

 

34,849

 

 

 

92,460

 

Proceeds from repayment of note receivable

 

 

9,866

 

 

 

-

 

Net cash used in investing activities

 

 

(200,349

)

 

 

(517,127

)

Financing activities:

 

 

 

 

 

 

 

 

Proceeds from issuance of common stock

 

 

82,068

 

 

 

7,465

 

Dividends paid on common and preferred stock

 

 

(190,585

)

 

 

(168,241

)

Noncontrolling interest contributions

 

 

-

 

 

 

452,327

 

Noncontrolling interest distributions

 

 

(22,028

)

 

 

(1,171

)

Debt and equity issuance costs paid

 

 

(2,892

)

 

 

(5,659

)

Net proceeds from (payments on) credit facilities

 

 

66,639

 

 

 

(607,496

)

Repurchase and payments of debt

 

 

(313,005

)

 

 

(710,400

)

Proceeds from issuance of debt

 

 

347,850

 

 

 

1,165,359

 

Net cash provided by (used in) financing activities

 

 

(31,953

)

 

 

132,184

 

 

 

 

 

 

 

 

 

 

Effect of foreign currency exchange rate changes on cash

 

 

(7,909

)

 

 

10,457

 

Net decrease in cash and cash equivalents

 

 

(158,679

)

 

 

(302,243

)

Cash and cash equivalents, beginning of period

 

 

350,692

 

 

 

491,129

 

Cash and cash equivalents, end of period

 

$

192,013

 

 

$

188,886

 

 

See Note 14 for information on non-cash investing and financing activities and other information.

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

4

 


 

PROLOGIS, L.P.

CONSOLIDATED BALANCE SHEETS

(In thousands)

 

 

March 31,

 

 

 

 

 

 

2015

 

 

December 31,

 

 

(Unaudited)

 

 

2014

 

ASSETS

 

 

 

 

 

 

 

Investments in real estate properties

$

21,800,499

 

 

$

22,190,145

 

Less accumulated depreciation

 

2,877,478

 

 

 

2,790,781

 

Net investments in real estate properties

 

18,923,021

 

 

 

19,399,364

 

Investments in and advances to unconsolidated entities

 

4,559,721

 

 

 

4,824,724

 

Assets held for sale

 

337,229

 

 

 

43,934

 

Note receivable backed by real estate

 

197,500

 

 

 

-

 

Net investments in real estate

 

24,017,471

 

 

 

24,268,022

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

192,013

 

 

 

350,692

 

Other assets

 

1,251,337

 

 

 

1,199,509

 

Total assets

$

25,460,821

 

 

$

25,818,223

 

 

 

 

 

 

 

 

 

LIABILITIES AND CAPITAL

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

Debt

$

8,641,421

 

 

$

9,380,199

 

Accounts payable and accrued expenses

 

459,845

 

 

 

627,999

 

Other liabilities

 

566,748

 

 

 

626,426

 

Total liabilities

 

9,668,014

 

 

 

10,634,624

 

 

 

 

 

 

 

 

 

Capital:

 

 

 

 

 

 

 

Partners' capital:

 

 

 

 

 

 

 

General partner - preferred

 

78,235

 

 

 

78,235

 

General partner - common

 

14,536,738

 

 

 

13,897,274

 

Limited partners

 

55,833

 

 

 

48,189

 

Total partners' capital

 

14,670,806

 

 

 

14,023,698

 

Noncontrolling interests

 

1,122,001

 

 

 

1,159,901

 

Total capital

 

15,792,807

 

 

 

15,183,599

 

Total liabilities and capital

$

25,460,821

 

 

$

25,818,223

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

5

 


 

PROLOGIS, L.P.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per unit amounts)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

 

2014

 

Revenues:

 

 

 

 

 

 

 

 

Rental income

 

$

324,547

 

 

$

300,878

 

Rental recoveries

 

 

94,255

 

 

 

87,362

 

Strategic capital income

 

 

42,025

 

 

 

45,310

 

Development management and other income

 

 

2,020

 

 

 

1,132

 

Total revenues

 

 

462,847

 

 

 

434,682

 

Expenses:

 

 

 

 

 

 

 

 

Rental expenses

 

 

126,934

 

 

 

110,517

 

Strategic capital expenses

 

 

20,361

 

 

 

24,163

 

General and administrative expenses

 

 

56,288

 

 

 

63,203

 

Depreciation and amortization

 

 

169,808

 

 

 

160,280

 

Other expenses

 

 

5,575

 

 

 

5,053

 

Total expenses

 

 

378,966

 

 

 

363,216

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

83,881

 

 

 

71,466

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Earnings from unconsolidated entities, net

 

 

31,042

 

 

 

29,746

 

Interest expense

 

 

(68,761

)

 

 

(85,523

)

Interest and other income, net

 

 

11,049

 

 

 

14,050

 

Gains on dispositions of investments in real estate, net

 

 

277,715

 

 

 

17,055

 

Foreign currency and derivative gains (losses) and related amortization, net

 

 

34,566

 

 

 

(28,184

)

Gains (losses) on early extinguishment of debt, net

 

 

(16,289

)

 

 

273

 

Total other income (expense)

 

 

269,322

 

 

 

(52,583

)

Earnings before income taxes

 

 

353,203

 

 

 

18,883

 

Current income tax expense

 

 

839

 

 

 

5,848

 

Deferred income tax expense

 

 

1,052

 

 

 

1,032

 

Total income tax expense

 

 

1,891

 

 

 

6,880

 

Consolidated net earnings

 

 

351,312

 

 

 

12,003

 

Net earnings attributable to noncontrolling interests

 

 

(3,154

)

 

 

(5,185

)

Net earnings attributable to controlling interests

 

 

348,158

 

 

 

6,818

 

Less preferred unit distributions

 

 

1,670

 

 

 

2,135

 

Net earnings attributable to common unitholders

 

$

346,488

 

 

$

4,683

 

Weighted average common shares outstanding - Basic

 

 

515,931

 

 

 

500,463

 

Weighted average common shares outstanding - Diluted

 

 

529,022

 

 

 

504,373

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to common unitholders - Basic

 

$

0.67

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to common unitholders - Diluted

 

$

0.65

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

Dividends per common unit

 

$

0.36

 

 

$

0.33

 

 

The accompanying notes are an integral part of these Consolidated Financial Statements.

 

 

 

6

 


 

PROLOGIS, L.P.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In thousands)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2015

 

 

2014

 

Consolidated net earnings

 

$

351,312

 

 

$

12,003

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

Foreign currency translation losses, net

 

 

(124,279

)

 

 

(4,723

)

Unrealized gains (losses) and amortization on derivative contracts, net

 

 

3,809

 

 

 

(1,261

)

Comprehensive income

 

 

230,842

 

 

 

6,019

 

Net earnings attributable to noncontrolling interests

 

 

(3,154

)

 

 

(5,185

)

Other comprehensive loss (income) attributable to noncontrolling interest

 

 

18,705

 

 

 

(2,966

)

Comprehensive income (loss) attributable to common stockholders

 

$

246,393

 

 

$

(2,132

)

 

 

 

PROLOGIS, L.P.

CONSOLIDATED STATEMENT OF CAPITAL

Three Months Ended March 31, 2015

(Unaudited)

(In thousands)

 

 

 

General Partner

 

 

Limited Partners

 

 

Non-

 

 

 

 

 

 

 

Preferred

 

 

Common

 

 

Common

 

 

controlling

 

 

 

 

 

 

 

Units