Mobile Infrastructure (BEEP) - 2024 Q2 - Quarterly Results

Q2 2024 Financial Results Overview Mobile Infrastructure reported strong Q2 2024 financial results, driven by strategic asset portfolio conversion and positive year-over-year growth in key financial metrics CEO Commentary and Strategic Progress The CEO highlighted positive operating and financial performance, driven by the strategic conversion of asset portfolios to managed service contracts, leading to a 14% rise in Net Operating Income - The strategic conversion of the asset portfolio to managed service contracts enhances data access for utilization and expense control[2] - This strategic conversion was a primary driver for the 14% year-on-year increase in Net Operating Income (NOI) in Q2[2] - The company is positioning to capitalize on secular growth trends, including downtown office-to-residential conversions and increased 'return to office' mandates, with benefits expected from 2025[3] Second Quarter Highlights Mobile Infrastructure reported strong Q2 2024 year-over-year growth, with significant revenue increase, narrowed net loss, and double-digit growth in NOI and Adjusted EBITDA Q2 2024 vs. Q2 2023 Financial Highlights | Metric | Q2 2024 ($ million) | Q2 2023 ($ million) | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $9.3 | $7.2 | +28.4% | | Net Loss | $2.5 | $3.7 | Improved | | NOI* | $5.6 | $4.9 | +14.1% | | Adjusted EBITDA* | $4.2 | $3.6 | +16.3% | Financial Results This section details the company's Q2 2024 financial performance, including revenue growth, expense changes, and balance sheet position Detailed Financial Performance Total revenue for Q2 2024 increased by 28.4% to $9.3 million, with net loss improving, NOI up 14.1%, and Adjusted EBITDA up 16.3%, despite rising operating expenses - Total revenue for Q2 2024 reached $9.3 million, marking a 28.4% increase from $7.2 million in Q2 2023[4] - Total property taxes and operating expenses increased to $3.6 million from $2.3 million year-over-year, reflecting the operational structure change[4] - General and administrative expenses totaled $2.9 million, including $1.6 million in non-cash compensation[5] - Interest expense decreased to $3.1 million in Q2 2024 from $3.7 million in Q2 2023[5] Balance Sheet and Liquidity As of June 30, 2024, the company maintained $13.3 million in cash and equivalents, with total debt outstanding slightly reduced to $191.5 million Key Balance Sheet Data (as of June 30, 2024) | Metric | Amount (in millions) | | :--- | :--- | | Cash, cash equivalents and restricted cash | $13.3 | | Total debt outstanding | $191.5 | - Total debt outstanding decreased from $192.9 million as of December 31, 2023, to $191.5 million as of June 30, 2024[6] Summary and Outlook The company reaffirmed its full-year 2024 guidance, introduced a $7.25 Net Asset Value per share, and will pause M&A activity until market conditions improve Full Year 2024 Guidance | Metric | Guidance Range (in millions) | | :--- | :--- | | Revenue | $38.0 - $40.0 | | Net Operating Income | $22.5 - $23.25 | - The company introduced Net Asset Value (NAV), estimated at $7.25 per share as of Q2 2024[7] - NAV is calculated using trailing 12-month Net Operating Income at a market capitalization rate, adjusted for balance sheet items[7] - The company will abstain from acquisitions until more favorable financial market conditions are realized, despite a growing pipeline[8] Financial Statements This section presents the consolidated balance sheets and statements of operations, detailing the company's financial position and performance Consolidated Balance Sheets As of June 30, 2024, total assets were $417.1 million, total liabilities $214.4 million, and total equity $202.7 million, showing slight decreases from year-end 2023 Assets (in thousands) | Asset Category | As of June 30, 2024 (in thousands) | As of Dec 31, 2023 (in thousands) | | :--- | :--- | :--- | | Total investments in real estate, net | $396,151 | $402,879 | | Cash and restricted cash | $13,314 | $16,711 | | Total assets | $417,112 | $423,237 | Liabilities and Equity (in thousands) | Liability/Equity Category | As of June 30, 2024 (in thousands) | As of Dec 31, 2023 (in thousands) | | :--- | :--- | :--- | | Notes payable & credit facility, net | $191,499 | $192,903 | | Total liabilities | $214,398 | $220,282 | | Total equity | $202,714 | $202,955 | | Total liabilities and equity | $417,112 | $423,237 | Consolidated Statements of Operations For Q2 2024, the company reported a net loss of $2.5 million, an improvement from $3.7 million in Q2 2023, reflecting a shift to managed property revenue and improved loss per share Statement of Operations Highlights - Three Months Ended June 30 (in thousands) | Metric | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Managed property revenue | $7,226 | $0 | | Base rent income | $1,523 | $1,951 | | Percentage rental income | $517 | $5,263 | | Total revenues | $9,266 | $7,214 | | Total expenses | $8,898 | $7,260 | | Net loss | ($2,469) | ($3,707) | | Net loss per share (basic & diluted) | ($0.06) | ($0.19) | Statement of Operations Highlights - Six Months Ended June 30 (in thousands) | Metric | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Total revenues | $18,093 | $14,317 | | Net loss | ($5,458) | ($7,049) | | Net loss per share (basic & diluted) | ($0.16) | ($0.36) | Non-GAAP Financial Measures This section discusses and reconciles non-GAAP financial measures, including Net Operating Income (NOI) and Adjusted EBITDA, to GAAP net loss Discussion of Non-GAAP Measures The company utilizes non-GAAP measures like Net Operating Income (NOI), EBITDA, and Adjusted EBITDA to assess property-level operating trends and facilitate performance comparisons by excluding variable items - Net Operating Income (NOI) is defined as total revenues less property operating expenses and taxes, used to evaluate property performance and operating trends[17] - EBITDA and Adjusted EBITDA are used for operating performance comparison, excluding interest, taxes, depreciation, amortization, and non-recurring or non-cash items like stock-based compensation[18][19] Reconciliation of Non-GAAP Measures This section reconciles GAAP net loss to non-GAAP metrics, showing Q2 2024 Net Operating Income of $5.6 million and Adjusted EBITDA of $4.2 million Reconciliation of Net Loss to NOI (in thousands) | Period | Net Loss (in thousands) | Net Operating Income (NOI) (in thousands) | | :--- | :--- | :--- | | Three Months Ended June 30, 2024 | ($2,469) | $5,633 | | Three Months Ended June 30, 2023 | ($3,707) | $4,939 | Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Period | Net Loss (in thousands) | Adjusted EBITDA (in thousands) | | :--- | :--- | :--- | | Three Months Ended June 30, 2024 | ($2,246) | $4,203 | | Three Months Ended June 30, 2023 | ($3,707) | $3,613 | Net Asset Value (NAV) The company introduced an estimated Net Asset Value (NAV) of $7.25 per fully diluted share as of June 30, 2024, calculated using a 4.0% cap rate on trailing twelve-month NOI, with a cautionary note on its non-GAAP nature Net Asset Value Calculation as of June 30, 2024 (in thousands, except per share data) | Component | Value (in thousands) | | :--- | :--- | | Total assets (estimated) | $567,091 | | Total liabilities | $201,223 | | Preferred stock | $33,782 | | Total estimated net asset value | $332,086 | | Fully diluted shares outstanding | 45,820,367 | | Net asset value per fully diluted share | $7.25 | - The estimated value of real estate investments was calculated using an implied capitalization rate of 4.0% applied to the Trailing Twelve-Month (TTM) Net Operating Income (NOI)[23] - The company cautions that NAV is a non-GAAP measure based on assumptions and estimates, not equivalent to stockholders' equity or a guarantee of realizable value[24]