Core Insights - Postal Realty Trust (PSTL) reported a revenue of $22.15 million for the quarter ended March 2025, reflecting a year-over-year increase of 28.1% [1] - The earnings per share (EPS) for the quarter was $0.32, a significant improvement from -$0.01 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $21.14 million by 4.80%, while the EPS also surpassed the consensus estimate of $0.30 by 6.67% [1] Revenue Breakdown - Rental income was reported at $21.48 million, exceeding the average estimate of $19.58 million by analysts, marking a 29.4% increase compared to the previous year [4] - Fee and other revenues were $0.67 million, slightly below the average estimate of $0.77 million, representing a decrease of 1.9% year-over-year [4] Stock Performance - Over the past month, shares of Postal Realty Trust have returned -7.9%, contrasting with the Zacks S&P 500 composite's -0.2% change [3] - The stock currently holds a Zacks Rank 1 (Strong Buy), suggesting potential for outperformance in the near term [3]

Group 1 - Postal Realty Trust (PSTL) reported quarterly funds from operations (FFO) of $0.32 per share, exceeding the Zacks Consensus Estimate of $0.30 per share, and up from $0.25 per share a year ago, representing a 6.67% surprise [1] - The company achieved revenues of $22.15 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 4.80%, compared to $17.29 million in the same quarter last year [2] - Over the last four quarters, Postal Realty Trust has consistently surpassed consensus FFO and revenue estimates [2] Group 2 - The stock has increased approximately 1.2% since the beginning of the year, while the S&P 500 has declined by 5.5% [3] - The future performance of Postal Realty Trust's stock will largely depend on management's commentary during the earnings call and the outlook for FFO [4][6] - The current consensus FFO estimate for the upcoming quarter is $0.29 on revenues of $21.46 million, and for the current fiscal year, it is $1.19 on revenues of $87.11 million [7] Group 3 - The Zacks Industry Rank indicates that the REIT and Equity Trust - Other sector is currently in the bottom 36% of over 250 Zacks industries, which may impact stock performance [8] - Clipper Realty Inc. (CLPR), another company in the same industry, is expected to report quarterly earnings of $0.16 per share, reflecting a year-over-year increase of 14.3% [9]

Property Acquisitions - In the three months ended March 31, 2025, the company acquired 36 properties leased to the USPS for approximately $16.3 million, including closing costs [150]. - The company acquired 25 properties for an aggregate of approximately $12.7 million subsequent to March 31, 2025 [202]. - The company continuously evaluates possible acquisitions of postal properties, which depend on market conditions and lease terms with USPS [193]. Portfolio Overview - As of March 31, 2025, the company's portfolio consists of 1,738 properties located in 49 states and one territory, comprising approximately 6.5 million net leasable interior square feet [152]. - As of March 31, 2025, properties leased to tenants had an average remaining lease term of approximately 4.0 years [161]. Financial Performance - Rental income increased by $4.9 million to $21.5 million for the three months ended March 31, 2025, representing a 29.4% increase compared to $16.6 million for the same period in 2024 [172]. - Total revenues rose by $4.9 million to $22.2 million for the three months ended March 31, 2025, reflecting a 28.1% increase from $17.3 million in the prior year [172]. - Income from operations surged by 106.7% to $6.3 million for the three months ended March 31, 2025, compared to $3.0 million for the same period in 2024 [172]. - Net income reached $2.7 million for the three months ended March 31, 2025, a significant increase of 937.1% from $0.3 million in the same period of 2024 [172]. - Cash flows from operating activities increased by $4.4 million to $10.8 million for the three months ended March 31, 2025, compared to $6.4 million for the same period in 2024 [182]. Debt and Liquidity - The company has a $150.0 million senior unsecured revolving credit facility and a $75.0 million senior unsecured term loan facility, among other credit facilities [167]. - As of March 31, 2025, the company had $274.0 million of aggregate principal amount outstanding under its Credit Facilities [187]. - The company had approximately $0.6 million of cash and $0.9 million of escrows and reserves as of March 31, 2025 [185]. - The company expects to meet its short-term liquidity requirements through net cash provided by operations, cash, borrowings under Credit Facilities, and potential issuance of securities [191]. - The company incurred $0.06 million of unused facility fees related to the Revolving Credit Facility during the three months ended March 31, 2025 [196]. Interest Rate Management - The company had nine interest rate swaps with a total notional amount of $250.0 million to manage interest rate risk [190]. - Approximately $274.0 million of the company's indebtedness was variable-rate debt as of March 31, 2025, with $250.0 million related to Term Loans fixed through Interest Rate Swaps [204]. - The company manages market risk on variable-rate debt through interest rate swaps, aiming to reduce floating rate exposure [205]. Dividends and Share Repurchase - The company paid cash dividends of $0.2425 per share during the three months ended March 31, 2025, with a first quarter 2025 common stock dividend declared on April 21, 2025 [199]. - The company has a Share Repurchase Program authorized for up to $25.0 million of Class A common stock, with no shares repurchased as of March 31, 2025 [201]. Operational Considerations - The USPS's financial and operational stability is critical to the company's business, as any decline in USPS's revenue could adversely affect the demand for leasing postal properties [159]. - General and administrative expenses are expected to rise as the portfolio grows, but as a percentage of revenues, these expenses are expected to decrease over time due to efficiencies [165]. - The company operates primarily through modified double-net leases, where the tenant is responsible for utilities and certain maintenance obligations [162]. - To maintain REIT qualification, the company must distribute at least 90% of its REIT taxable income, limiting reliance on retained earnings [194].

Financial Performance - The company reported a 28% growth in revenues from Q1 2024 to Q1 2025, totaling $22.15 million[6]. - Net income attributable to common shareholders was $2.1 million, or $0.06 per diluted share[6]. - Funds from Operations (FFO) were $8.4 million, or $0.28 per diluted share, while Adjusted Funds from Operations (AFFO) were $9.8 million, or $0.32 per diluted share[6]. - Net income for the three months ended March 31, 2025, was $2,655 thousand, with Funds From Operations (FFO) reported at $8,366 thousand[31]. - Adjusted Funds From Operations (AFFO) reached $9,808 thousand, with AFFO per common share at $0.32[31]. - 2025 guidance for AFFO per diluted share is projected to be between $1.20 and $1.22[12]. Property Acquisitions - The company acquired 36 USPS properties for approximately $15.8 million at a weighted average capitalization rate of 7.6%[6][4]. - Subsequent to the quarter end, the company acquired 25 properties for approximately $12.7 million, with another 35 properties under definitive contracts totaling approximately $21.6 million[11]. Portfolio and Occupancy - The property portfolio was 99.8% occupied, with a weighted average rental rate of $10.90 per leasable square foot[3]. - The company has agreed to new lease terms with the USPS for 2025 and 2026, which include 3% annual escalations[6]. Debt and Liabilities - As of March 31, 2025, the company had approximately $307 million of net debt with a weighted average interest rate of 4.41%[8]. - Total liabilities rose to $339,113 thousand as of March 31, 2025, compared to $329,320 thousand at the end of 2024, indicating an increase of about 2.39%[29]. Equity and Assets - Total assets increased to $654,018 thousand as of March 31, 2025, up from $646,818 thousand at December 31, 2024, representing a growth of approximately 1.85%[29]. - The company reported a total stockholders' equity of $245,479 thousand, down from $251,285 thousand, reflecting a decrease of approximately 2.30%[29]. Cash and Reserves - Cash reserves decreased to $639 thousand from $1,799 thousand, a decline of about 64.53%[29]. Expenses and Charges - The company incurred impairment charges of $65 thousand and a loss on the sale of real estate assets amounting to $49 thousand during the quarter[31]. - Depreciation and amortization of real estate assets totaled $5,597 thousand for the three months ended March 31, 2025[31]. - The company reported acquisition-related and other expenses of $122 thousand during the quarter[31]. Dividends - The company declared a quarterly dividend of $0.2425 per share, equating to $0.97 on an annualized basis[10]. Shares Outstanding - The weighted average common shares and common units outstanding were 30,293,528 for the period[31].

Core Viewpoint - Postal Realty Trust, Inc. reported strong performance in Q1 2025, with significant leasing activity and acquisitions, indicating a robust growth trajectory supported by long-term leases and stable cash flows [3][8]. Property Portfolio & Acquisitions - The company's portfolio was 99.8% occupied, consisting of 1,738 properties across 49 states and one territory, with approximately 6.5 million net leasable square feet and a weighted average rental rate of $10.90 per square foot as of March 31, 2025 [3]. - In Q1 2025, the company acquired 36 USPS properties for approximately $15.8 million, representing about 100,000 net leasable square feet at a weighted average rental rate of $13.69 per square foot [4][8]. Leasing Activity - As of April 16, 2025, the company secured 38 fully executed new leases from the USPS for leases expiring in 2025, with a total net lump sum catch-up payment of approximately $0.4 million received for leases executed during Q1 2025 [5][8]. Financial Performance - The company reported total revenues of $22.15 million for Q1 2025, a 28% increase from $17.29 million in Q1 2024, with net income attributable to common shareholders of $2.1 million, or $0.06 per diluted share [8][23]. - Funds from Operations (FFO) were $8.4 million, or $0.28 per diluted share, while Adjusted Funds from Operations (AFFO) were $9.8 million, or $0.32 per diluted share [8][28]. Balance Sheet & Capital Markets - As of March 31, 2025, the company had approximately $1.5 million in cash and property-related reserves, with net debt of approximately $307 million at a weighted average interest rate of 4.41% [6][8]. - The company issued 249,000 shares of common stock at an average price of $14.22 per share through its equity offering program [7]. Dividend Declaration - On April 21, 2025, the company declared a quarterly dividend of $0.2425 per share of Class A common stock, equating to an annualized rate of $0.97 per share [8]. 2025 Guidance - The company provided guidance for 2025, projecting AFFO per diluted share between $1.20 and $1.22, and acquisition volume between $80 million and $90 million [11].

Core Viewpoint - Postal Realty Trust, Inc. will report its financial results for the period ended March 31, 2025, on April 30, 2025, after market close [1] Group 1: Financial Reporting - The financial results will be discussed in a webcast and conference call on May 1, 2025, at 9:00 A.M. Eastern Time [2] - A telephonic replay of the call will be available from May 1, 2025, at 1:00 P.M. Eastern Time until May 15, 2025, at 11:59 P.M. Eastern Time [3] Group 2: Company Overview - Postal Realty Trust, Inc. is an internally managed real estate investment trust that owns and manages over 2,100 properties leased primarily to the United States Postal Service [4]

Core Points - Postal Realty Trust, Inc. announced a quarterly dividend of $0.2425 per share, marking a 1.0% increase from the first quarter 2024 dividend [1] - The dividend will be payable on May 30, 2025, to stockholders of record as of May 1, 2025 [1] Company Overview - Postal Realty Trust, Inc. is an internally managed real estate investment trust that owns and manages over 2,100 properties primarily leased to the United States Postal Service (USPS) [2]

Financial Data and Key Metrics Changes - The company reported an AFFO per share of $1.16 for 2024, marking an increase of 8.4% year over year and exceeding the Street consensus by over 9% at the start of 2024 [7] - Funds from operations (FFO) for Q4 2024 was $0.30 per diluted share, while adjusted funds from operations (AFFO) was $0.35 per diluted share [22] - The board approved a quarterly dividend of $0.2425 per share, a 1% increase from Q4 2023, marking the seventh consecutive year of dividend increases [23] - The net debt to annualized adjusted EBITDA ratio was 5.2 times at the end of the year, reflecting a deleveraging from the end of 2023 [25] Business Line Data and Key Metrics Changes - In 2024, the company acquired 197 properties for $91 million at a weighted average cap rate of 7.6% [11] - The company updated its same-store cash NOI guidance for 2025 to be between 4% and 6%, up from prior guidance of at least 3% [9] - The total net lump sum catch-up payment received during Q4 was $1.5 million, with an additional $400,000 received in 2025 [18] Market Data and Key Metrics Changes - The company maintained a current occupancy rate of 99.8% and has averaged a 99% lease retention rate with the Postal Service over the past ten-plus years [13] - The Postal Service's lease expenses represent only 1.5% of its total operating budget, indicating a stable relationship with the company [13][34] Company Strategy and Development Direction - The company aims to drive internal growth while pursuing an acquisition-driven external growth plan [7] - The focus remains on lease execution for 2025 expirations and negotiating rents for 2026 expirations [19] - The company is well-positioned for future growth due to its strong relationship with postal property owners and the critical role of the Postal Service in the economy [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the Postal Service's continued tenancy and the importance of their facilities to the logistics network [13][39] - The company anticipates acquisition volume in 2025 to be between $80 million and $90 million, targeting a weighted average cap rate at or above 7.5% [11] - Management highlighted the importance of the Postal Service's infrastructure and its role in driving commerce [14][15] Other Important Information - The company completed its first meaningful dispositions as a public company, selling two properties for total gross proceeds of $6.3 million [12] - The company has a $150 million senior unsecured revolving credit facility with $136 million undrawn, maintaining low leverage and minimizing exposure to variable rate debt [24] Q&A Session Summary Question: Impact of new postmaster general on lease agreements - Management indicated that the new postmaster general would not change existing lease documents, as lease expenses are a low priority for the Postal Service [33][34] Question: Postal Service's cost-cutting measures and facility eliminations - Management believes there will be no changes to the infrastructure related to the facilities they invest in, as the Postal Service has stated there will be no disruption to their retail network [39] Question: Same-store NOI growth and G&A expenses - Management confirmed that the anticipated same-store NOI growth for 2025 is between 4% and 6%, with G&A expenses expected to rise slightly [46][47] Question: Catch-up rent payments and revenue run rate - Management clarified that they are now caught up on leases, with a clear run rate for the upcoming year based on executed leases [55]

Financial Data and Key Metrics Changes - The company reported an AFFO per share of $1.16 for 2024, marking an increase of 8.4% year over year and exceeding the Street consensus by over 9% at the start of 2024 [7] - Funds from operations (FFO) for Q4 was $0.30 per diluted share, while adjusted funds from operations (AFFO) was $0.35 per diluted share [22] - The board approved a quarterly dividend of $0.2425 per share, a 1% increase from Q4 2023, marking the seventh consecutive year of dividend increases [23] - The net debt to annualized adjusted EBITDA ratio was 5.2 times at the end of the year, reflecting a deleveraging from the end of 2023 [25] Business Line Data and Key Metrics Changes - In 2024, the company acquired 197 properties for $91 million at a weighted average cap rate of 7.6% [11] - The company anticipates acquisition volume in 2025 to be between $80 million and $90 million, targeting a weighted average cap rate at or above 7.5% [11] - The total net lump sum catch-up payment received during Q4 was $1.5 million, with an additional $400,000 received in 2025 [18] Market Data and Key Metrics Changes - The company reported a current occupancy rate of 99.8% and an average lease retention rate of 99% with the Postal Service over the past ten years [13] - The Postal Service's lease expenses represent only 1.5% of its total operating budget, indicating a stable relationship with the company [13][34] Company Strategy and Development Direction - The company aims to drive internal growth while pursuing an acquisition-driven external growth plan [7] - The management emphasized the importance of maintaining strong relationships with postal property owners to expand the portfolio [16] - The company is focused on executing leases for 2025 expirations and negotiating rents for 2026 expirations [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the Postal Service's continued tenancy and the stability of their lease agreements despite changes in leadership [33] - The Postal Service's recent cost-cutting measures are not expected to disrupt the company's operations or the facilities they invest in [39] - The company is optimistic about its acquisition pipeline and internal growth story, projecting AFFO for 2025 to be between $1.20 and $1.22 per share [10][27] Other Important Information - The company completed its first meaningful dispositions as a public company, selling two properties for total gross proceeds of $6.3 million [12] - The company has a $150 million senior unsecured revolving credit facility with $136 million undrawn, maintaining low leverage and minimizing exposure to variable rate debt [24] Q&A Session Summary Question: Impact of new postmaster general on lease agreements - Management indicated that the new postmaster general is not expected to change existing lease documents, as the company has a strong process in place for lease execution [33] Question: Postal Service's cost-cutting measures and facility eliminations - Management believes that the cost-cutting measures will not affect the infrastructure related to the facilities they invest in, as the Postal Service has stated there will be no disruption to their retail network [39] Question: Same-store NOI growth and G&A expenses - Management confirmed that the same-store NOI growth for 2025 is projected to be between 4% and 6%, with G&A expenses expected to increase slightly [46] Question: Catch-up rent payments in Q4 - Management clarified that the catch-up rent payments were part of the top-line revenue, and they are now caught up with the expiration schedule for leases [54]

Corporate Information & Analyst Coverage | Key Management | | | --- | --- | | Andrew Spodek | Chief Executive Officer | | Jeremy Garber | President, Treasurer & Secretary | | Robert Klein | Chief Financial Officer | | Board of Directors | Board Responsibilities | | Patrick Donahoe | Chair of the Board, Member - Audit Committee | | Andrew Spodek | Chief Executive Officer, Director | | Barry Lefkowitz | Chair of Audit Committee, Member - Corporate Governance & Compensation Committee | | Anton Feingold | Chair ...