Farmland Partners(FPI) - 2024 Q4 - Annual Results

Farmland Partners Inc. Full Year 2024 Performance Report Report Overview and Business Highlights Farmland Partners Inc. achieved strong 2024 results with 94% net income growth and over 80% AFFO per share increase, driven by strategic asset dispositions and debt reduction - CEO Luca Fabbri stated 2024 was a very strong year, successfully executing strategies to reduce general and administrative expenses, improve operational efficiency, and selectively dispose of assets, enabling debt reduction and share repurchases at a significant discount during high interest rate periods[2] 2024 Key Performance Highlights | 2024 Key Performance Highlights | Amount/Description | | :--- | :--- | | Net Income | $61.5 million (or $1.19 per share) | | AFFO | $14.1 million (or $0.29 per share) | | Asset Dispositions | Completed 54 farm dispositions totaling $312.0 million, realizing gains of $54.1 million | | Share Repurchases | Repurchased 2,240,295 shares at a weighted average price of $12.25 per share | | Debt Reduction | Total debt reduced by $158.5 million, estimated annual interest savings of $10.9 million | | Leverage Ratio | Debt as a percentage of total book value decreased from 36.3% to 27.2% | | Special Dividend | Declared a special dividend of $1.15 per share | - Subsequent to December 31, 2024, the company continued its strategy, completing a $4.1 million farm disposition, repaying $2.0 million in loan principal, and issuing $3.1 million in new loans under the FPI Loan Program[3] Financial and Operating Performance The company's 2024 financial performance showed significant year-over-year growth in net income and AFFO, alongside a substantial reduction in total debt Financial and Operating Performance (As of December 31) | Financial and Operating Performance (As of December 31) | 2024 ($ in thousands) | 2023 ($ in thousands) | Change | | :--- | :--- | :--- | :--- | | Financial Performance | | | | | Net Income | $61,450 | $31,681 | 94.0% | | Net Income Per Share | $1.19 | $0.55 | 116.4% | | AFFO | $14,074 | $8,140 | 72.9% | | AFFO Per Share | $0.29 | $0.16 | 81.3% | | Operating Performance | | | | | Total Operating Revenue | $58,226 | $57,466 | 1.3% | | Net Operating Income (NOI) | $46,921 | $44,052 | 6.5% | - In 2024, the company acquired four properties for $17.9 million and completed 54 property dispositions for $312 million, realizing $54.1 million in sales gains[11] - As of December 31, 2024, total debt decreased from $363.1 million in the prior year to $204.6 million, while available liquidity increased from $206.6 million to $245.8 million[11] Financial Statements This section presents detailed consolidated financial statements for 2024 and 2023, reflecting the company's financial position and operational outcomes Consolidated Balance Sheets The 2024 balance sheet reflects strategic asset dispositions, showing reduced total assets and a significant decrease in total liabilities Consolidated Balance Sheet Items | Balance Sheet Items ($ in thousands) | December 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Net Real Estate | $717,843 | $961,531 | | Total Assets | $868,560 | $1,022,002 | | Mortgage Notes and Bonds Payable, Net | $203,683 | $360,859 | | Total Liabilities | $272,003 | $391,192 | | Total Equity | $494,587 | $528,840 | Consolidated Statements of Operations For 2024, the company reported a 94% increase in net income to $61.5 million, driven by asset disposition gains and reduced operating expenses Consolidated Statements of Operations Items | Operations Statement Items ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Total Operating Revenue | $58,226 | $57,466 | | Total Operating Expenses | $33,539 | $39,467 | | Net Gain on Asset Dispositions | $54,148 | $36,133 | | Net Income | $61,450 | $31,681 | | Basic Net Income Attributable to Common Stockholders Per Share | $1.19 | $0.55 | Non-GAAP Financial Measures and Reconciliations This section details the reconciliation of GAAP net income to key non-GAAP performance metrics, including FFO, AFFO, EBITDAre, and NOI Reconciliation of Non-GAAP Measures Reconciliation tables illustrate adjustments from net income to non-GAAP metrics, showing significant increases in FFO, AFFO, Adjusted EBITDAre, and NOI for 2024 Net Income to FFO and AFFO Reconciliation | Net Income to FFO and AFFO Reconciliation ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Net Income | $61,450 | $31,681 | | Less: Net Gain on Asset Dispositions | ($54,148) | ($36,133) | | Plus: Depreciation, Depletion, and Amortization | $5,588 | $7,499 | | Plus: Impairment of Assets | $790 | $5,840 | | FFO | $13,680 | $8,887 | | Adjustments... | ... | ... | | AFFO | $14,074 | $8,140 | Net Income to EBITDAre and Adjusted EBITDAre Reconciliation | Net Income to EBITDAre and Adjusted EBITDAre Reconciliation ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Net Income | $61,450 | $31,681 | | Adjustments... | ... | ... | | EBITDAre | $32,518 | $31,378 | | Adjustments... | ... | ... | | Adjusted EBITDAre | $35,882 | $33,403 | Operating Revenue to NOI Reconciliation | Operating Revenue to NOI Reconciliation ($ in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Total Operating Revenue | $58,226 | $57,466 | | Less: Property Operating Expenses | $7,368 | $8,660 | | Less: Cost of Sales | $3,937 | $4,754 | | NOI | $46,921 | $44,052 | Definitions of Non-GAAP Measures The company defines its key non-GAAP metrics, including FFO, AFFO, EBITDAre, and NOI, explaining their calculation and utility for investors - FFO (Funds From Operations): Calculated according to Nareit standards, excluding depreciation, amortization, and gains/losses on asset dispositions from net income to measure core operating performance[29] - AFFO (Adjusted Funds From Operations): Further adjusted from FFO to exclude non-recurring items like share-based compensation and acquisition costs, considered by management a more useful measure of ongoing operational performance[30][31] - EBITDAre (Earnings Before Interest, Taxes, Depreciation, and Amortization for Real Estate): Calculated per Nareit standards, with the company further adjusting to Adjusted EBITDAre by excluding items such as share-based compensation and acquisition costs to better reflect operating results[33][34] - NOI (Net Operating Income): Calculated as total operating revenue less property operating expenses and cost of sales, reflecting income and expenses directly related to owning and leasing farmland real estate[36] Other Information This section provides additional company updates, including quarterly dividend announcements, 2025 guidance access, and investor call details - The company's Board of Directors declared a quarterly cash dividend of $0.06 per share on February 18, 2025, payable on April 15, 2025[9] - For 2025 earnings guidance, refer to page 15 of the supplemental materials in the investor relations section of the company's website[10] - A conference call is scheduled for February 20, 2025, at 11:00 AM ET to discuss financial results and provide a company update[12] - As of December 31, 2024, the company is an internally managed real estate company owning and/or managing approximately 141,800 acres of farmland across 16 states[14]