ProLogis eyes cash conservation, consolidation
Warehouse and distribution center developer ProLogis said this week it will add liquidity, cut jobs and reduce dividends in order to cope with difficult market conditions, moves that boosted its stock price by more than 50 percent on Thursday, the Wall Street Jounal’s MarketWatch reported.
The company’s stock fell 35 percent Wednesday after ProLogis announced longtime Chief Executive Officer Jeffrey Schwartz was stepping down. But in a new plan unveiled Thursday, the company, which develops and manages warehouses and DCs around the globe, said it would conserve cash by holding off on new developments and land acquisitions. The new, CEO, former president and chief operating officer Walter Rakowich, said the company intends to “right-size” itself given the current economic environment. By most accounts, ProLogis is the biggest global developer of logistics facilities, with significant holdings in the United States, Europe and China.
Analysts said the changes would help the company improve its balance sheet.
The company is “looking out from a deep hole,” Joel Bloomer, an analyst at Morningstar Inc., told MarketWatch. Over the last few years, ProLogis 'overexpanded, overleveraged and overcomplicated its operations.”