Despite the mood gradually sinking as retail heads into the holiday, Tanger Factory Outlet Centers Inc. rode into the black last quarter and has decided to raise its outlook for 2022.
On Wednesday, the Greensboro, North Carolina, outlet center operator reported net income of 22 cents per common share, or $23 million, compared to a net loss of 11 cents per share, or $11 million, in the year-ago period.
Tanger also said it raised its earnings outlook for the year to 75 cents to 80 cents per diluted share, from previously the projected 71 cents to 77 cents.
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The news sent Tanger’s stock price up more than 3 percent, or 56 cents, to $18.50, after a decline earlier in the day.
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“We are pleased to announce another quarter of strong results. As a result of our continued momentum and outlook for the remainder of 2022, we are raising our full-year 2022 earnings guidance, and we recently increased our dividend for the second time this year, bringing year-to-date growth to over 20 percent,” Stephen Yalof, president and chief executive officer, said in a statement.
“Tanger is driving success by delivering on our strategic priorities of accelerating leasing, commercializing marketing and reshaping operations, which has led to sustained NOI [net operating income] growth, improvement in rent spreads, longer lease terms and higher occupancy,” Yalof added. “Our open-air shopping destinations are gaining elevated and digitally native brands, iconic food and beverage and entertainment uses that connect Tanger shoppers with the brands, value and experience they desire.”
The company noted that the prior-year period included a loss on the early extinguishment of debt of 31 cents per share, or $33.8 million.
For the quarter ended Sept. 30, funds from operations available to common shareholders were 47 cents per share, or $51.7 million, compared to 16 cents per share, or $17.8 million, for the prior-year period.
Core funds from operations available to common shareholders were 47 cents per share, or $51.7 million, about flat from the prior-year period, of 47 cents per share, or $51.8 million. Core FFO for the third quarter of 2021 excludes the loss on the early extinguishment of debt cited above. The company does not consider this item to be indicative of its ongoing operating performance.
In other operating metrics:
- Lease termination fees totaled $200,000 for the third quarter of 2022 and $2.9 million for the first nine months of 2022, compared to $1.8 million for the third quarter of 2021 and $3.2 million for the first nine months of 2021.
- Occupancy was 96.5 percent as of Sept. 30, compared to 94.9 percent on June 30, and 94.4 percent on Sept.30, 2021.
- Average tenant sales productivity remained nearly flat at $446 per square foot for the 12 months ended Sept. 30, compared to $448 per square foot for the year prior, a decrease of 0.4 percent for both the total portfolio and on a same center basis.
- Same center net operating income increased 2.4 percent to $82.2 million for the third quarter of 2022 from $80.3 million for the third quarter of 2021.