Kimco Realty Corporation (NYSE:KIM) Q4 2024 Earnings Conference Call February 7, 2025 8:30 AM ET Company Participants David Bujnicki - SVP, IR Conor Flynn - CEO Ross Cooper - President & CIO Glenn Cohen - CFO David Jamieson - EVP & COO Conference Call Participants Michael Goldsmith - UBS Craig Mailman - Citi Alexander Goldfarb - Piper Sandler Dori Kesten - Wells Fargo Haendel St. Juste - Mizuho Greg McGinniss - Scotiabank Andrew Reale - Bank of America Juan Sanabria - BMO Capital Markets Caitlin Burrows - G ...

Financial Data and Key Metrics Changes - FFO for Q4 2024 was $286.9 million or $0.42 per diluted share, up from $239.4 million or $0.39 per diluted share in Q4 2023, representing a per-share increase of 7.7% [35] - Total pro-rata NOI increased by $60.8 million or 17.8% to $403.4 million compared to the same period last year [35] - Year-end portfolio occupancy stood at 96.3%, reflecting a year-over-year increase of 10 basis points [37] Business Line Data and Key Metrics Changes - Same-site NOI growth for Q4 was 4.5%, driven primarily by higher minimum rent contributing 3.8% [38] - RPT same-site NOI growth reached 6.2%, with occupancy increasing by 120 basis points [23] - Internet-resistant retailers now account for over 50% of new lease volume, with a surge in leasing to medical and wellness tenants [19] Market Data and Key Metrics Changes - National vacancy rate remains near record lows, facilitating strong leasing momentum [13] - The lack of new supply is measured at just 0.3% of existing retail stock, contributing to favorable supply and demand dynamics [13] - The average unemployment rate across the portfolio is 20 basis points lower than the national average, supporting increased sales at retailers [16] Company Strategy and Development Direction - The company is focused on repositioning its portfolio into first-ring suburbs to leverage natural barriers to entry and pricing power advantages [14] - Kimco Realty Corporation aims to transform its portfolio into a grocery-anchored and mixed-use portfolio, capitalizing on demographic trends [15] - The company plans to selectively dispose of long-term flat ground leases and monetize select development entitlements to enhance growth [32] Management's Comments on Operating Environment and Future Outlook - Management remains confident about growth prospects despite economic uncertainties and recent tenant bankruptcies [43] - The initial 2025 FFO per share outlook range is $1.70 to $1.72, representing a growth range of 3% to 4.2% [43] - The company anticipates same property NOI growth of 2% plus, factoring in potential credit loss from bankruptcies [44] Other Important Information - The company achieved its goal of entitling 12,000 apartment units a year ahead of schedule, expanding its mixed-use portfolio [15] - The liquidity position remains strong with $690 million in cash and full availability of a $2 billion revolving credit facility [41] - Moody's affirmed the company's Baa1 unsecured debt rating with a positive outlook [42] Q&A Session Summary Question: Can you talk about the credit loss reserve and exposure to potential trouble tenants? - Management indicated a credit loss reserve of 75 to 100 basis points, with a 130 basis point impact from tenants in bankruptcy [51][60] - The company has already absorbed a 10 basis point impact from Big Lots in 2024, with ongoing efforts to backfill spaces [52][56] Question: What does the opportunity set look like for acquisitions? - Management stated that they have already identified and closed on net acquisition activity, with plans to recycle capital from dispositions into new opportunities [67][69] Question: Can you provide more color on the assumptions for credit loss reserves? - Management expressed comfort with the credit loss range, considering the ongoing bankruptcy processes for Party City and Joanne's [111][112] Question: What is the focus on development and redevelopment spending? - Management emphasized a retail-driven focus for redevelopment, with opportunities to backfill existing spaces rather than extensive new development [96][99] Question: How are you planning to market spaces from bankrupt tenants? - The company markets spaces well in advance of any bankruptcy filings, with ongoing efforts to upgrade tenancy and secure new leases [125][126]

Core Viewpoint - Kimco Realty Corp. reported strong fourth-quarter 2024 results, with funds from operations (FFO) per share meeting expectations and showing year-over-year growth, despite increased interest expenses [1][2][4]. Financial Performance - FFO per share for Q4 2024 was 42 cents, a 7.7% increase from the previous year [1] - Total revenues reached $525.4 million, exceeding the consensus estimate of $513.1 million, and reflecting a 16.3% year-over-year improvement [2] - For the full year 2024, FFO per share was $1.65, up 5.1% from $1.57, surpassing the Zacks Consensus Estimate of $1.64 [2] - Annual revenues increased 14.2% year over year to $2.04 billion [2] Operational Highlights - Pro-rata portfolio occupancy at the end of Q4 was 96.3%, up 10 basis points year over year [3] - Pro-rata anchor occupancy was 98.2%, reflecting a 20 basis point increase year over year [3] - Pro-rata small shop occupancy remained flat at 91.7% year over year [3] - Kimco executed 429 leases totaling 2.4 million square feet in the quarter, with blended pro-rata cash rent spreads on comparable spaces at 11.4% [4] Cost and Expenses - Interest expenses rose 23.4% year over year to $83.7 million [4] - Same-property net operating income (NOI) grew 4.5% year over year, supported by a 3.8% increase in minimum rent [4] Acquisition Activity - Kimco acquired Waterford Lakes Town Center for $322 million and Markets at Town Center for $108 million [5] Balance Sheet and Liquidity - The company ended Q4 2024 with $2.7 billion in immediate liquidity, including $689.7 million in cash [6] - Net-debt-to-EBITDA ratio was 5.6x, unchanged from the prior year [6] Equity Offering - Kimco raised $136.3 million from the sale of 5.4 million shares at an average price of $25.07 per share [7] Dividend Declaration - A quarterly cash dividend of 25 cents per share was declared, payable on March 21, 2025 [9] 2025 Guidance - For 2025, Kimco expects FFO per share in the range of $1.70 to $1.72, above the Zacks Consensus Estimate of $1.69 [10] - The outlook is based on same-property NOI growth of over 2.0% and total acquisitions expected between $100 million and $125 million [10]

Core Insights - Kimco Realty reported $525.4 million in revenue for Q4 2024, a 16.3% year-over-year increase, with an EPS of $0.42 compared to $0.22 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $513.1 million by 2.40%, while the EPS met the consensus estimate [1] Financial Performance Metrics - Pro-rata portfolio occupancy was reported at 96.3%, slightly below the estimated 96.8% [4] - Management and other fee income was $4.33 million, below the average estimate of $4.57 million, but showed a year-over-year increase of 16.9% [4] - Revenues from rental properties, net, were $521.06 million, surpassing the average estimate of $511.41 million, reflecting a year-over-year change of 16.3% [4] - Diluted net EPS was reported at $0.23, exceeding the average estimate of $0.17 [4] Stock Performance - Kimco Realty shares returned +1.7% over the past month, compared to the Zacks S&P 500 composite's +1.9% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market [3]

Kimco Realty (KIM) came out with quarterly funds from operations (FFO) of $0.42 per share, in line with the Zacks Consensus Estimate. This compares to FFO of $0.39 per share a year ago. These figures are adjusted for non-recurring items.A quarter ago, it was expected that this real estate investment trust would post FFO of $0.41 per share when it actually produced FFO of $0.43, delivering a surprise of 4.88%.Over the last four quarters, the company has surpassed consensus FFO estimates three times.Kimco Rea ...

Financial Performance - Fourth quarter 2024 net income was $154.8 million, or $0.23 per diluted share, a 4.5% increase from $133.4 million, or $0.22 per diluted share in Q4 2023[4] - Full year 2024 net income was $375.7 million, or $0.55 per diluted share, down from $629.3 million, or $1.02 per diluted share in 2023, primarily due to a special cash dividend received in 2023[8] - Net income attributable to the company for the year ended December 31, 2024, was $410.8 million, compared to $654.3 million in 2023, reflecting a decrease of 37.2%[24] - The company reported a basic net income per common share of $0.23 for Q4 2024, compared to $0.22 for Q4 2023, marking a 4.5% increase[24] - Net income available to the company's common shareholders for Q4 2024 was $154.835 million, an increase of 16% from $133.360 million in Q4 2023[27] Funds From Operations (FFO) - Funds From Operations (FFO) grew 7.7% year-over-year to $286.9 million, or $0.42 per diluted share, compared to $239.4 million, or $0.39 per diluted share in Q4 2023[7] - FFO for the full year 2024 was $1.1 billion, or $1.65 per diluted share, representing a 5.1% increase from $970.0 million, or $1.57 per diluted share in 2023[9] - Funds from Operations (FFO) available to the company's common shareholders for Q4 2024 was $286.901 million, up 20% from $239.443 million in Q4 2023[27] - FFO per common share - diluted for the year ended December 31, 2024, was $1.65, compared to $1.57 for the year ended December 31, 2023, reflecting a 5% increase[27] - The projected range for FFO available to the company's common shareholders for the full year 2025 is between $1.70 and $1.72 per diluted share[33] Revenue and Income Growth - Total revenues for Q4 2024 reached $525.4 million, a 16.3% increase from $451.6 million in Q4 2023[24] - Rental property revenues for the year were $2.02 billion, a 14.3% increase from $1.77 billion in 2023[24] - Same Property Net Operating Income (NOI) increased by 4.5% in Q4 2024, driven by a 3.8% rise in minimum rents[13] - Same Property Net Operating Income (NOI) for the year ended December 31, 2024, was $1.526 billion, a 3.5% increase from $1.475 billion in 2023[30] Portfolio and Acquisitions - The company acquired Waterford Lakes Town Center for $322 million and Markets at Town Center for $108 million, expanding its portfolio significantly[5][11] - Pro-rata portfolio occupancy reached 96.3%, up 10 basis points year-over-year, with pro-rata anchor occupancy at 98.2%, an increase of 20 basis points[5] Assets and Liabilities - The company's total assets increased to $20.3 billion in 2024, up from $18.3 billion in 2023, representing an 11.1% growth[22] - Total liabilities rose to $9.46 billion in 2024, compared to $8.55 billion in 2023, an increase of 10.7%[22] - The company’s cash and cash equivalents decreased to $689.7 million in 2024 from $783.8 million in 2023, a decline of 12.0%[22] - The company ended 2024 with approximately $2.7 billion of immediate liquidity, including $689.7 million in cash and cash equivalents[15] Expenses and Charges - Operating income for Q4 2024 was $166.4 million, slightly down from $168.6 million in Q4 2023[24] - Interest expense and other income, net for Q4 2024 was $66.032 million, compared to $46.917 million in Q4 2023, showing an increase of 41%[30] - The company incurred impairment charges of $4.5 million for the year, down from $14.0 million in 2023[24] - The company reported impairment charges of $9.985 million for the year ended December 31, 2024, down from $15.060 million in 2023[27] - The company incurred merger-related charges of $25.246 million for the year ended December 31, 2024, compared to $4.766 million in 2023[28] Lease Activity - Kimco signed 429 leases totaling 2.4 million square feet in Q4 2024, with new leases generating blended pro-rata cash rent spreads of 11.4%[13] Depreciation and Amortization - Depreciation and amortization related to real estate for the year ended December 31, 2024, was $603.685 million, compared to $507.265 million in 2023, indicating a significant increase[30] Shareholder Returns - Preferred dividends increased to $31.8 million for the year ended December 31, 2024, compared to $25.0 million in 2023, reflecting a 27.2% increase[24] Share Count - The weighted average shares outstanding for FFO calculations increased to 681.726 million in Q4 2024 from 620.356 million in Q4 2023[27]

– Achieves High End of Full Year Outlook with Strong Fourth Quarter Growth in Net Income and FFO – – Leased Over 11 Million Square Feet in 2024 – – Company Provides Initial 2025 Outlook – JERICHO, N.Y., Feb. 07, 2025 (GLOBE NEWSWIRE) -- Kimco Realty® (NYSE: KIM), a real estate investment trust (REIT) and leading owner and operator of high-quality, open-air, grocery-anchored shopping centers and mixed-use properties in the United States, today reported results for the fourth quarter and full year ended Decem ...

Core Viewpoint - Kimco Realty Corporation is expected to report fourth-quarter and full-year 2024 results on February 7, with anticipated year-over-year growth in revenues and funds from operations (FFO) per share [1][11]. Company Performance - In the last reported quarter, Kimco outperformed the Zacks Consensus Estimate by 4.9% in FFO per share, with year-over-year revenue growth, although rising interest expenses negatively impacted performance [2][9]. - Over the past four quarters, Kimco's FFO per share exceeded the Zacks Consensus Estimate three times, with an average beat of 2.5% [3]. Industry Insights - The U.S. retail availability rate remained stable at 4.7%, despite store closures and a decrease in net absorption, indicating stability in retail market fundamentals [3]. - Net absorption in the fourth quarter declined by 14% sequentially to 5.7 million square feet, significantly below the 10-year quarterly average of 17 million square feet [4]. - New retail development was low, with construction completions down 52% from the prior quarter, attributed to rising construction costs, labor shortages, and tight lending conditions [5]. Rental Market Dynamics - Average asking rent increased by 0.4% quarter-over-quarter and 2.5% year-over-year to $23.80 per square foot, driven by strong competition for limited space and high demand for prime locations [6]. Growth Factors - Kimco's properties are located in economically strong metropolitan areas, which are expected to support demand and boost quarterly performance [7]. - The company benefits from a diverse tenant base, including essential and necessity-based retailers, aiding stable revenue generation [8]. - A solid balance sheet is likely to support growth, although high interest expenses may have affected performance [9]. Projections - The Zacks Consensus Estimate for Kimco's quarterly revenues is $516.7 million, reflecting a 14.4% year-over-year growth, with net revenues from rental properties expected to reach $505.5 million, a 12.9% increase [11]. - Interest expenses are projected to rise by 17.7% year-over-year in the fourth quarter, while FFO per share is expected to increase by 7.7% to 42 cents [12]. - For full-year 2024, Kimco projects FFO per share between $1.64 and $1.65, supported by a same-property net operating income growth of over 3.25% and total acquisitions of $565-$625 million [13].

Wall Street analysts expect Kimco Realty (KIM) to post quarterly earnings of $0.42 per share in its upcoming report, which indicates a year-over-year increase of 7.7%. Revenues are expected to be $516.67 million, up 14.4% from the year-ago quarter.The consensus EPS estimate for the quarter has undergone an upward revision of 0.3% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.Before a ...

Portfolio and Market Position - Kimco Realty is well-positioned with a portfolio of premium shopping centers, predominantly grocery-anchored, located in top major metropolitan Sunbelt and coastal markets [1] - The company's top major metro markets contribute 82% of the annual base rent, with superior trade area demographics exceeding the U.S. average by 21% for median household income [4][5] - Kimco's focus on mixed-use assets in strong economic metropolitan statistical areas supports portfolio diversification and higher CAGR compared to retail-only sites [9] Financial Performance and Growth - Kimco's shares gained 9.4% over the past six months, outperforming the industry's growth of 6.6% [3] - The company's 2024 funds from operations (FFO) were revised upward to $1.64 over the past two months [3] - Rent per square foot witnessed a CAGR of 3.8% from 2020 to Q3 2024 [5] Tenant and Asset Strategy - Kimco has a highly diversified tenant base, including essential, necessity-based tenants and omni-channel retailers such as TJX Companies, The Home Depot, Ross Stores, Burlington Stores, and Amazon/Whole Foods Market [6] - 84% of the company's annual base rent (ABR) in Q3 2024 came from grocery-anchored centers, with a target to achieve 85% by 2025 [7] Acquisitions and Expansion - In January, Kimco acquired The Markets at Town Center in Jacksonville, FL, spanning 254,000 square feet for $108 million, strengthening its footprint in the Jacksonville market [2] - The Jacksonville market includes six properties encompassing 1.5 million square feet with a 98.6% occupancy rate as of Dec. 31, 2024 [2] Balance Sheet and Liquidity - Kimco exited Q3 2024 with over $2.8 billion of immediate liquidity and a consolidated weighted average debt maturity profile of 8.3 years [10] - More than 90% of the company's properties are unencumbered, enabling favorable borrowing rates [10]