Select Income REIT (SIR) has reported a 79.47 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $6.73 million, or $0.08 a share in the quarter, compared with $32.78 million, or $0.37 a share for the same period last year.
Revenue from real estate activities during the quarter went down marginally by 0.80 percent or $0.94 million to $116.29 million.
Cost of revenue rose 5.39 percent or $0.55 million during the quarter to $10.84 million. Gross margin for the quarter contracted 55 basis points over the previous year period to 90.68 percent.
Total expenses were $88.90 million for the quarter, up 39.46 percent or $25.15 million from year-ago period. Operating margin for the quarter contracted 2207 basis points over the previous year period to 23.55 percent.
Operating income for the quarter was $27.39 million, compared with $53.48 million in the previous year period.
Income from operating leases during the quarter went down marginally by 0.53 percent or $0.52 million to $97.34 million. Revenue from tenant reimbursements was $18.95 million for the quarter, down 2.18 percent or $0.42 million from year-ago period.
David Blackman, president and chief operating officer of SIR, made the following statement: "Select Income REIT’s solid leasing momentum continued in the first quarter of 2017. We executed 484,000 square feet of new and renewal leases for weighted average rents that were over 20% higher than previous rents for the same space, for 10 years of weighted average lease term, and with leasing concessions and capital commitments of $0.23 per square foot per lease year. We also acquired land to expand a building for an existing tenant and entered agreements to acquire two additional properties."
Receivables move up marginally
Net receivables were at $111.69 million as on Mar. 31, 2017, up 4.63 percent or $4.95 million from year-ago. Total assets went down marginally by 1.68 percent or $78.75 million to $4,614.06 million on Mar. 31, 2017. On the other hand, total liabilities were at $2,562.86 million as on Mar. 31, 2017, down 1.11 percent or $28.87 million from year-ago.
Return on assets moved down 54 basis points to 0.60 percent in the quarter. At the same time, return on equity moved down 123 basis points to 0.33 percent in the quarter.
Debt remains almost stable
Total debt was at $2,367.28 million as on Mar. 31, 2017, down 0.94 percent or $22.40 million from year-ago. Shareholders equity stood at $2,051.20 million as on Mar. 31, 2017, down 2.37 percent or $49.87 million from year-ago. As a result, debt to equity ratio went up 2 basis points to 1.15 percent in the quarter.
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