Seritage(US:SRG)2024-11-12 22:11Financial Performance - The company reported a net loss attributable to common shareholders of $23.2 million, or $0.41 per share for the three months ended September 30, 2024[4]. - Total revenue for Q3 2024 was $3,251,000, a decrease from $5,048,000 in Q3 2023, representing a decline of 35.5%[23]. - Rental income for Q3 2024 was $2,899,000, down from $4,525,000 in Q3 2023, a decrease of 36.0%[23]. - Total expenses increased to $22,516,000 in Q3 2024 from $16,711,000 in Q3 2023, an increase of 34.5%[23]. - Net loss attributable to Seritage common shareholders for Q3 2024 was $23,198,000, compared to a loss of $2,127,000 in Q3 2023[23]. - Net loss per share attributable to Seritage Class A common shareholders was $(0.41) for Q3 2024, compared to $(0.04) in Q3 2023[23]. - NOI-cash basis for Q3 2024 was $(2,256,000), a decline from $306,000 in Q3 2023[24]. - The company reported a gain on the sale of real estate of $4,184,000 in Q3 2024, down from $18,506,000 in Q3 2023[23]. - Abandoned project costs for Q3 2024 were $5,732,000, with no such costs reported in Q3 2023[23]. Assets and Liabilities - As of September 30, 2024, the company had cash on hand of $98.2 million, including $12.6 million of restricted cash[4]. - The Company's total assets decreased from $973.864 million on December 31, 2023, to $735.022 million as of September 30, 2024, reflecting a decline of approximately 24.5%[22]. - The net investment in real estate dropped from $546.342 million to $355.021 million, a decrease of about 35%[22]. - The term loan facility was reduced from $360 million to $280 million, indicating a decrease of approximately 22.2%[22]. - Total liabilities decreased from $410.700 million to $316.228 million, a reduction of about 22.9%[22]. - The accumulated deficit increased from $800.342 million to $946.202 million, reflecting a worsening financial position[22]. Leasing and Property Management - The company has five assets under contract for anticipated gross proceeds of $87.9 million, with two assets expected to generate $33.7 million and three assets $54.2 million[3]. - The company signed two leases covering 5.5 thousand square feet at a projected average annual net rent of $65.57 PSF during the third quarter[5]. - The company has 348 thousand square feet of in-place leased square feet in its Premier Mixed-Use properties, with a 74.7% occupancy rate[10]. - The company has 216 thousand square feet of office and retail leasing in progress at its Aventura project, with 78.7% leased as of September 30, 2024[12]. - The company is currently negotiating a definitive purchase and sale agreement for one income-producing asset expected to generate gross proceeds of $29.9 million[3]. - The company generated $24.0 million in gross proceeds from the sale of an income-producing asset at an 8.5% capitalization rate[3]. Strategic Initiatives and Market Conditions - The Company approved a Plan of Sale at the 2022 Annual Meeting of Shareholders, with ongoing strategic review and potential sale options being considered[17]. - The Company continues to face challenging market conditions impacting asset pricing and sale proceeds, which may affect shareholder distributions[17]. - The company is exploring multiple options for refinancing its pending term loan maturity in July 2025, including discussions with current lenders and potential recapitalization options[2]. - The company expects to use its cash reserves and future sales to meet financing obligations and fund operations[13]. Forward-Looking Statements and Risks - Forward-looking statements indicate potential risks including declines in retail and real estate markets, which may significantly affect future results[20]. - The Company utilizes non-GAAP financial measures such as NOI-cash basis to provide insights into its financial performance, although these measures are not directly comparable to GAAP[19].