Alexander & Baldwin(ALEX)2025-04-25 20:57Financial Performance - Operating revenue for the first quarter of 2025 decreased by 12.2%, or $7.5 million, to $53.7 million compared to the same period in 2024, primarily due to lower revenues from the Land Operations segment's land sales[100] - Cost of operations decreased by 10.4%, or $3.1 million, to $27.1 million, mainly due to lower cost of sales associated with land sales in the Land Operations segment[101] - Net income for the first quarter of 2025 was $21.4 million, an increase of 7.3% or $1.5 million compared to $20.0 million in 2024[99] - Funds From Operations (FFO) decreased by 9.8%, or $2.9 million, to $26.3 million for the first quarter of 2025 compared to $29.2 million in 2024[99] - Adjusted FFO decreased by 12.7%, or $3.2 million, to $22.3 million for the first quarter of 2025 compared to $25.5 million in 2024[99] - Same-store net operating income (NOI) increased to $32.4 million in Q1 2025 from $31.1 million in Q1 2024, a growth of 4.2%[140] Real Estate Operations - Gain on commercial real estate transactions was $4.1 million, attributed to a ground lease agreement for a 4.7-acre land parcel in Maui Business Park[102] - Commercial Real Estate operating revenue increased by 4.4%, or $2.2 million, to $51.0 million for the first quarter of 2025 compared to the same period in 2024[107] - Commercial Real Estate operating profit rose by 6.6%, or $1.4 million, to $23.4 million for the first quarter of 2025 compared to the prior year[107] - Land Operations segment reported total operating revenue of $2.7 million for Q1 2025, down from $12.3 million in Q1 2024, with operating profit decreasing from $7.9 million to $4.9 million[122][123] Leasing Activity - The Company signed 10 new leases and 32 renewal leases covering a total of 236,800 square feet of GLA, with new leases averaging $16.34 per square foot and renewal leases averaging $27.58 per square foot[109] - The average base rent for 6 comparable new leases increased by 34.6% over expiring leases, while 27 comparable renewal leases saw a 6.4% increase[109] - As of March 31, 2025, the Leased Occupancy rate was 95.4%, up from 94.0% in the previous year, representing a 140 basis point increase[114] - Economic Occupancy improved to 93.9% as of March 31, 2025, compared to 92.3% a year earlier, marking a 160 basis point increase[116] - The retail sector's Leased Occupancy increased to 95.2% from 93.2%, while the industrial sector rose to 97.3% from 96.8%, and the office sector decreased to 79.5% from 83.9%[115] Cash Flow and Capital Expenditures - Operating cash flows from continuing operations for Q1 2025 were $25.9 million, an increase of $9.4 million compared to $16.5 million in Q1 2024, representing a growth of 56.8%[148] - Total capital expenditures for real estate in Q1 2025 amounted to $4,053,000, an increase of 9.3% compared to $3,706,000 in Q1 2024[154] - Cash used in investing activities for continuing operations was $0.8 million in Q1 2025, down from $3.7 million in Q1 2024[152] - Cash used in financing activities for continuing operations was $41.3 million in Q1 2025, up from $25.2 million in Q1 2024, primarily due to cash dividend payments of $16.5 million and debt repayments of $16.6 million[154] Debt and Financial Position - As of March 31, 2025, the company had $440.2 million in fixed-rate debt and $13.0 million in variable-rate debt, with a total weighted average interest rate of 4.62%[143] - The company had $16.9 million in cash on hand as of March 31, 2025, and $307.0 million of available capacity under its revolving credit facility[150] - The Company intends to maintain compliance with financial covenants to ensure continued access to its credit facilities[142] Stock and Market Considerations - The Company has authorized a stock repurchase program of up to $100.0 million, with no shares repurchased during Q1 2025[155] - The company entered into an at-the-market equity distribution agreement allowing for the sale of common stock up to $200.0 million, with no shares sold as of March 31, 2025[151] - The Company faces potential negative impacts from general economic conditions, including inflationary pressures and market volatility, which could affect operating results[158] - The impact of an elevated federal funds rate has contributed to credit tightening and volatility in various industries, including banking and housing[158] - Management's estimates in financial statements are subject to uncertainty, and actual results may differ materially from these estimates[159] - There have been no material changes in market risk disclosures since December 31, 2024[162]