Select Income REIT (SIR) has reported 7.11 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $28.57 million, or $0.32 a share in the quarter, compared with $30.76 million, or $0.34 a share for the same period last year.
Revenue during the quarter went up marginally by 2.76 percent to $115.04 million from $111.94 million in the previous year period.
Cost of revenue rose 8.96 percent or $0.88 million during the quarter to $10.76 million. Gross margin for the quarter contracted 53 basis points over the previous year period to 90.65 percent.
Total expenses were $66.08 million for the quarter, up 8.36 percent or $5.10 million from year-ago period. Operating margin for the quarter contracted 297 basis points over the previous year period to 42.56 percent.
Operating income for the quarter was $48.96 million, compared with $50.96 million in the previous year period.
Revenue from real estate activities during the quarter went up marginally by 2.76 percent or $3.09 million to $115.04 million.
Income from operating leases during the quarter went up marginally by 1.36 percent or $1.29 million to $96.04 million. Revenue from tenant reimbursements was $19 million for the quarter, up 10.48 percent or $1.80 million from year-ago period.
David Blackman, president and chief operating officer of SIR, made the following statement:
"During the quarter, we entered one million square feet of new and renewal leases, which resulted in a 4.9% increase in rental rates. In addition to leasing, we made two new property purchases at what we believe are attractive terms despite what is generally considered a current aggressive property valuation environment. Our lease expiration schedule continues to be well laddered, with a large majority of our leases expiring after 2022."
Net receivables were at $117.16 million as on Sep. 30, 2016, up 28.04 percent or $25.66 million from year-ago.
Total assets went down marginally by 2.19 percent or $104.39 million to $4,657.26 million on Sep. 30, 2016. On the other hand, total liabilities were at $2,565.32 million as on Sep. 30, 2016, down 0.91 percent or $23.52 million from year-ago.
Return on assets moved down 1 basis points to 1.06 percent in the quarter. At the same time, return on equity moved down 5 basis points to 1.37 percent in the quarter.
Debt comes down marginallyTotal debt was at $2,360.60 million as on Sep. 30, 2016, down 1.25 percent or $29.96 million from year-ago. Shareholders equity stood at $2,091.93 million as on Sep. 30, 2016, down 3.58 percent or $77.60 million from year-ago. As a result, debt to equity ratio went up 3 basis points to 1.13 percent in the quarter.
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