Today, the Company announced its financial performance for the quarter ending September 30, 2024.
Key Highlights:
For the quarter ending September 30, 2024, the Company reported:
- Net Income: $1.8 million, or $0.02 per share for common stockholders, compared to $4.3 million (which included a $10.3 million gain from asset disposals), or $0.07 per share for the same period in 2023.
- Adjusted Funds from Operations (AFFO): $1.4 million, or $0.03 per share, versus a loss of $0.5 million, or ($0.01) per share, in the same quarter of 2023.
- Total Operating Revenues: Increased by $1.7 million, or 14.6%, despite a reduction in the average gross book value of real estate from $1.08 billion to $1.01 billion—a decline of 6.7% due to asset sales in 2023. This reflects the Company’s strategic focus on maximizing farm revenues while providing shareholders with returns from appreciated farmland sales.
- Total Operating Expenses: Decreased by approximately $3.5 million, representing a 30.2% decline compared to the same quarter in 2023.
Recent Developments Post-September 30, 2024:
- The Company finalized 52 farm sales in two transactions for a total of $308 million.
- It repaid $189.4 million of debt at an average interest rate of 5.77%, thereby eliminating exposure to floating-rate debt and anticipating approximately $10.9 million in annual interest savings.
- The debt-to-gross book value ratio decreased from 38.8% as of September 30, 2024, to 27.1% as of October 28, 2024, with the ratio of total debt to EBITDAre reducing from 10.9 to 5.8.
- A loan of about $20 million was issued under the FPI Loan Program to a former tenant and its affiliates.
- The AFFO guidance for 2024 was revised upwards, now ranging from $0.24 to $0.30, up from $0.20 to $0.26.
Comments from the CEO:
Luca Fabbri, President and Chief Executive Officer, stated, “We are excited to report another robust operational quarter, driven by the efficiencies we’ve implemented through portfolio enhancements and cost-saving measures initiated in 2023. Our increased earnings guidance for 2024 reflects these core improvements and the completion of $308 million in asset sales, leading to $189 million in debt reductions and interest savings, which we expect to fully realize in the upcoming quarters. The gains from these sales, amounting to approximately $53 million, showcase the significant value within our portfolio, which we believe remains undervalued in the market. With the remaining proceeds, we plan to reduce further debt, repurchase stock, and explore strategic acquisitions. Additionally, we anticipate issuing a special dividend to shareholders at year-end, estimated between $1.00 and $1.10 per share.”
For comprehensive definitions of AFFO, Adjusted EBITDAre, and NOI, as well as financial tables detailing reconciliations from net income to these metrics, please refer to the section on “Non-GAAP Financial Measures” below.
Acquisition and Disposition Activity:
During the nine months ending September 30, 2024, the Company acquired three properties for a total of $16.3 million. No properties were disposed of during this period.
Balance Sheet Overview:
As of September 30, 2024, the Company’s total debt stood at approximately $394 million, an increase from about $363.1 million as of December 31, 2023. The Company had $140.2 million in liquidity, comprised of $8.1 million in cash and $132.1 million in undrawn credit facilities, compared to $5.5 million in cash and $201.1 million in undrawn credit facilities at the end of 2023. After repaying $189.4 million in debt post-September 30, 2024, the Company increased its credit facility availability to $168.9 million. As of October 25, 2024, there were 49,375,976 shares of common stock outstanding on a fully diluted basis.
Dividend Declarations:
On October 29, 2024, the Board of Directors declared a quarterly cash dividend of $0.06 per share for common stock and Class A Common OP units, payable on January 15, 2025, to stockholders and common unit holders of record as of January 2, 2025.
2024 Earnings Guidance and Supplemental Information:
For detailed 2024 earnings guidance, please refer to page 15 of the supplemental package available on the Company’s Investor Relations website.
Conference Call Announcement:
The Company has scheduled a conference call for October 31, 2024, at 11:00 a.m. (U.S. Eastern Time) to discuss financial results and provide updates.
