City Office REIT, Inc. (CIO) saw its loss narrow to $1.94 million, or $0.08 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $2.50 million, or $0.20 a share.
Revenue during the quarter grew 28.57 percent to $18.79 million from $14.62 million in the previous year period.
Cost of revenue surged 33.76 percent or $1.86 million during the quarter to $7.38 million. Gross margin for the quarter contracted 152 basis points over the previous year period to 60.70 percent.
Total expenses were $17.15 million for the quarter, up 17.44 percent or $2.55 million from year-ago period. Operating margin for the quarter expanded 865 basis points over the previous year period to 8.72 percent.
Operating income for the quarter was $1.64 million, compared with $0.01 million in the previous year period.
Revenue from real estate activities during the quarter increased 29 percent or $4.15 million to $18.45 million.
Income from operating leases during the quarter surged 32.08 percent or $4.04 million to $16.64 million. Revenue from tenant reimbursements was $1.80 million for the quarter, up 6.11 percent or $0.10 million from year-ago period.
Other income during the quarter was $0.34 million, up 9.27 percent or $0.03 million from year-ago period.
"During the third quarter of 2016 and subsequent to quarter end, we completed property transactions and significant financing events that we believe demonstrate our ability to create long term value for our shareholders," commented James Farrar, City Office's chief executive officer. "We closed over $129 million of acquisitions and, with an additional property under contract for $42.6 million, expanded our geographic footprint of growth markets to include Phoenix, Arizona. These high-quality acquisitions were acquired or will be acquired at expected cap rates significantly in excess of the estimated sale cap rate of our Washington Group Plaza property, providing another example of our ability to effectively recycle capital."
Receivables move up
Net receivables were at $14.03 million as on Sep. 30, 2016, up 10.65 percent or $1.35 million from year-ago.
Total assets grew 8 percent or $36.11 million to $487.43 million on Sep. 30, 2016. On the other hand, total liabilities were at $330.83 million as on Sep. 30, 2016, down 11.19 percent or $41.69 million from year-ago.
Return on assets moved up 33 basis points to 0.34 percent in the quarter. Return on equity for the quarter stood at negative 1.24 percent as compared to a negative 3.17 percent for the previous year period.
Debt comes down
Total debt was at $302.77 million as on Sep. 30, 2016, down 12.23 percent or $42.18 million from year-ago. Shareholders equity stood at $156.60 million as on Sep. 30, 2016, up 98.75 percent or $77.81 million from year-ago. As a result, debt to equity ratio went down 244 basis points to 1.93 percent in the quarter.
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