Orion Office REIT (ONL) - 2024 Q4 - Annual Results

Financial Performance - Total revenues for Q4 2024 were $38.4 million, down from $43.8 million in Q4 2023[7] - Net loss attributable to common stockholders for Q4 2024 was $(32.8) million, or $(0.59) per share, compared to $(16.2) million, or $(0.29) per share in Q4 2023[7] - Core FFO for Q4 2024 was $10.2 million, or $0.18 per diluted share, down from $18.5 million, or $0.33 per diluted share in Q4 2023[7] - For the full year 2024, total revenues were $164.9 million, compared to $195.0 million in 2023[8] - Total revenues for the year ended December 31, 2024, were $164,862, a decrease of 15.4% compared to $195,041 in 2023[79] - Net loss attributable to common stockholders for the year ended December 31, 2024, was $103,012, compared to a net loss of $57,302 in 2023, representing an increase of 79.8%[79] - Funds from Operations (FFO) attributable to common stockholders decreased to $7,642,000 in Q4 2024 from $16,447,000 in Q4 2023, a decline of 53.6%[84] - Core FFO attributable to common stockholders for Q4 2024 was $10,192,000, down from $18,499,000 in Q4 2023, reflecting a 44.9% decrease[84] - Adjusted EBITDA for Q4 2024 was $16,579,000, compared to $24,647,000 in Q4 2023, indicating a decline of 32.8%[84] - Full Year Adjusted EBITDA decreased from $118,542 million in 2023 to $82,849 million in 2024, a decline of about 30.2%[90] Leasing and Property Management - The company completed 1.1 million square feet of leasing in 2024, which is four times the leasing volume of 261,000 square feet in 2023[3] - The occupancy rate as of December 31, 2024, was 73.7%, with 74.4% of Annualized Base Rent derived from Investment-Grade Tenants[14] - The company acquired a 97,000 square foot property for $34.6 million in 2024, fully leased to a single tenant with a remaining term of 15 years[11] - The company sold two vacant properties in 2024 for a total gross sales price of $5.3 million[12] Financial Metrics and Ratios - The Company utilizes Adjusted EBITDA as a non-GAAP measure to evaluate operating performance, which excludes non-routine items and certain non-cash items[38] - Funds Available for Distribution (FAD) is defined as Core FFO modified to exclude capital expenditures and leasing costs, providing insight into the Company's ability to fund its dividend[41] - The Company calculates Net Debt as Adjusted Principal Outstanding minus cash and cash equivalents, which aids in assessing financial flexibility and capital structure[60] - The Net Debt Leverage Ratio equals Net Debt divided by Gross Real Estate Investments, providing a measure of leverage[61] - The Company reported a Fixed Charge Coverage Ratio, which is Adjusted EBITDA divided by the sum of Interest Expense and secured debt principal amortization, indicating its ability to meet fixed financing obligations[39] - The Company defines Cash NOI as total revenues less property operating expenses, excluding certain GAAP adjustments, providing a clearer view of property-level performance[62] - The Interest Coverage Ratio decreased to 2.13x in Q4 2024 from 3.35x in Q4 2023, indicating a decline in the company's ability to cover interest expenses[86] - Net Debt to Annualized Most Recent Quarter Adjusted EBITDA Ratio rose significantly from 4.82x in 2023 to 7.57x in 2024[90] - Net Debt to Full Year Adjusted EBITDA Ratio increased from 4.01x in 2023 to 6.06x in 2024[90] Expenses and Liabilities - Property operating expenses for the year ended December 31, 2024, increased to $65,151, up 7.3% from $60,783 in 2023[79] - The Company reported a net interest expense of $32,637 for the year ended December 31, 2024, compared to $29,669 in 2023, indicating an increase of 9.9%[79] - The Company experienced impairments totaling $47,552 for the year ended December 31, 2024, compared to $33,112 in 2023, an increase of 43.8%[79] - Total debt as reported increased to $490,222,000 as of December 31, 2024, from $468,856,000 in the previous year, marking a 4.5% rise[88] - Net Debt rose to $502,304,000 in Q4 2024, up from $475,209,000 in Q4 2023, an increase of 5.5%[88] Company Changes and Future Outlook - The Company changed its name from Orion Office REIT Inc. to Orion Properties Inc. on March 5, 2025, to reflect a broader investment strategy[31] - The Company anticipates potential risks from rising interest rates and inflation affecting future financial performance and operational costs[72] - The Company expects 2025 Core FFO per diluted share to range between $0.61 and $0.70[92] - General & Administrative Expenses are projected to be between $19.5 million and $20.5 million[95]