Franklin Street Properties (US:FSP)2024-10-29 20:25Financial Performance - Rental revenue for Q3 2024 was $29.662 million, a decrease of 4% from $30.818 million in Q2 2024 [6]. - Net income for Q3 2024 was a loss of $15.622 million, compared to a loss of $21.023 million in Q2 2024 [6]. - Adjusted EBITDA for Q3 2024 was $9.657 million, down from $10.783 million in Q2 2024 [6]. - Funds from Operations (FFO) for Q3 2024 was $2.665 million, a decline from $3.721 million in Q2 2024 [6]. - Total revenue for the three months ended September 30, 2024, was $29,682,000, a decrease of 18.5% compared to $36,903,000 for the same period in 2023 [7]. - Net loss for the three months ended September 30, 2024, was $(7,552,000), compared to a net loss of $(15,622,000) for the same period in 2023, representing a 51.7% improvement [7]. - Total expenses for the three months ended September 30, 2024, were $39,585,000, a 4.5% increase from $37,857,000 in the same period last year [7]. - Net loss for the nine months ended September 30, 2024, was $44,197,000, an improvement from a loss of $51,685,000 in the same period last year [11]. - Funds From Operations (FFO) for the nine months ended September 30, 2024, was $10,264,000, a decrease from $29,574,000 for the same period in 2023 [13]. - The company reported a net loss of $15,622,000 for the three months ended September 30, 2024, compared to a net loss of $45,671,000 for the same period in 2023 [13]. Assets and Liabilities - The total assets of the company as of September 30, 2024, were $981.513 million, down from $1.012 billion in Q2 2024 [6]. - Total liabilities decreased to $335,099,000 as of March 31, 2024, from $330,450,000 in June 30, 2024 [10]. - The company reported a loss on the sale of properties and impairment of assets held for sale of $20,459,000 for the nine months ended September 30, 2024 [11]. - The company reported cash and cash equivalents of $42,375,000 as of September 30, 2024 [32]. - The company has a total outstanding debt of $277,688 thousand as of September 30, 2024, with an average interest rate of 8.00% [16]. Property and Leasing - The percentage of owned properties leased was 70.4% as of September 30, 2024, a decrease from 72.3% in Q2 2024 [6]. - The total number of owned properties decreased to 15 as of September 30, 2024, from 16 in the previous quarter [18]. - The total square footage of owned properties is reported at 4,966,398 square feet, down from 5,264,416 square feet in the previous quarter [18]. - The company has a total of 1,469,414 square feet of owned property that is currently vacant [24]. - New leasing activity for the nine months ended September 30, 2024, was 122,000 square feet, down from 206,000 square feet in the same period last year, while renewals and expansions totaled 242,000 square feet compared to 365,000 square feet [23]. Dividends and Shareholder Information - The company declared a dividend of $0.01 per share for Q3 2024, consistent with previous quarters [6]. - Total dividends declared for the quarter amount to $1.034 million, with a common dividend declared per share of $0.01 [17]. - Declared dividend as a percentage of net income per share is reported at (14)% for the quarter [17]. Non-GAAP Measures - The Company evaluates performance based on Funds From Operations (FFO), which is defined as net income excluding certain gains and losses, with adjustments for depreciation and amortization [33]. - Adjusted Funds From Operations (AFFO) is calculated by excluding non-cash losses on debt extinguishment and including distributions from non-consolidated REITs, among other adjustments [36]. - Net Operating Income (NOI) is defined as net income plus general and administrative expenses, excluding non-property specific income and expenses, providing insight into property performance [35]. - EBITDA is defined as net income plus interest, taxes, depreciation, and amortization, with Adjusted EBITDA excluding certain gains and losses [34]. - The Company emphasizes that FFO, EBITDA, and AFFO should not be considered alternatives to net income or cash flows from operating activities as defined by GAAP [33][34][36]. Market Capitalization and Debt - Total market capitalization as of September 30, 2024, is $537.79 million, a decrease from $586.35 million in the previous quarter [17]. - The company reported a net debt of $265,221 thousand as of September 30, 2024, down from $386,890 thousand a year earlier [14]. - The company has a maximum loan amount of $24,000,000 secured by the property, with the maturity date extended to September 30, 2025 [30]. Operational Insights - The company incurred total capital expenditures of $16,947,000 for the nine months ended September 30, 2024, with tenant improvements accounting for $9,621,000 [26]. - The average GAAP rents on leasing increased by 10.9% year-over-year, up from 7.2% in the previous year [23]. - The company recorded a significant decrease in Adjusted Funds From Operations (AFFO) to $(1,778,000) for the nine months ended September 30, 2024, compared to $1,810,000 for the same period in 2023 [13].