Farmland Partners(FPI) - 2025 Q1 - Quarterly Results

First Quarter 2025 Results Overview Selected Highlights Q1 2025 saw increased net income and AFFO, driven by strategic portfolio management and share repurchases, leading to raised full-year guidance Q1 2025 Key Metrics | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income | $2.1 million | $1.4 million | | Net Income per Share | $0.03 | $0.01 | | AFFO | $2.3 million | $2.8 million | | AFFO per Share | $0.05 | $0.06 | - Completed acquisitions of five properties for a total of $6.5 million[3] - Completed two farm dispositions for $10.0 million, recognizing a gain of $0.8 million[3] - Repurchased 63,023 shares of common stock at a weighted average price of $11.74 per share[3] - Increased the full-year 2025 AFFO guidance range to $0.28 - $0.34 per share, up from $0.25 - $0.30[3] CEO Comments The CEO attributed strong Q1 results and raised 2025 guidance to optimized farm operations, strategic asset disposals, share buybacks, and improved financial income - The company's strategy focuses on optimizing farm operations, disposing of selected assets to reallocate proceeds, and buying back undervalued stock[2] - Financial performance was aided by increased interest income, a significant reduction in interest expense, and revenues from a solar power production arrangement[2] Financial and Operating Performance Financial and Operating Results Q1 2025 net income increased by 48.7% to $2.1 million despite a 14.5% decrease in total operating revenues to $10.3 million and an 18.0% decline in AFFO to $2.3 million Financial and Operating Results (Q1 2025 vs Q1 2024) | Metric (in thousands) | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Financial Results | | | | | Net Income | $2,093 | $1,408 | 48.7% | | AFFO | $2,284 | $2,784 | (18.0)% | | Adjusted EBITDAre | $5,682 | $8,582 | (33.8)% | | Operating Results | | | | | Total Operating Revenues | $10,252 | $11,990 | (14.5)% | | Net Operating Income (NOI) | $8,108 | $9,651 | (16.0)% | - Q1 2025 results include approximately $1.0 million from a solar lease arrangement[6] - Q1 2024 results included approximately $1.2 million of income from forfeited deposits related to a terminated repurchase agreement[6] Portfolio Activity and Balance Sheet In Q1 2025, the company strategically acquired $6.5 million in properties and disposed of $10.0 million, slightly reducing total debt while liquidity decreased due to lower cash balances - Acquired five properties for $6.5 million and disposed of two properties for $10.0 million during Q1 2025[10] - Total debt outstanding was approximately $202.6 million at March 31, 2025, compared to $204.6 million at December 31, 2024[10] - Total liquidity was $189.1 million at quarter-end, consisting of $21.7 million in cash and $167.4 million in undrawn credit facilities[10] Dividend Declarations The Board of Directors declared a quarterly cash dividend of $0.06 per share of common stock and Class A Common OP unit, payable on July 15, 2025 - A quarterly cash dividend of $0.06 per share was declared, payable on July 15, 2025[8] Consolidated Financial Statements Consolidated Balance Sheets As of March 31, 2025, total assets decreased to $810.5 million from $868.6 million, primarily due to reduced cash, while total liabilities also significantly decreased to $218.5 million Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total real estate, net | $714,095 | $717,843 | | Cash and cash equivalents | $21,650 | $78,441 | | Total Assets | $810,465 | $868,560 | | Mortgage notes and bonds payable, net | $201,803 | $203,683 | | Total Liabilities | $218,518 | $272,003 | | Total Equity | $492,204 | $494,587 | Consolidated Statements of Operations Q1 2025 total operating revenues decreased to $10.3 million, primarily from lower rental income, yet net income increased to $2.1 million due to reduced interest expense and a net gain on asset dispositions Statement of Operations Summary (in thousands) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Rental income | $6,970 | $10,207 | | Total operating revenues | $10,252 | $11,990 | | Total operating expenses | $6,399 | $6,843 | | (Gain) loss on disposition of assets, net | $(763) | $86 | | Interest expense | $2,638 | $5,036 | | Net Income | $2,093 | $1,408 | | Basic net income per share | $0.03 | $0.01 | Reconciliation of Non-GAAP Measures The company reconciled GAAP net income to non-GAAP measures, showing Q1 2025 FFO at $2.5 million, AFFO at $2.3 million, Adjusted EBITDAre at $5.7 million, and NOI at $8.1 million, all lower year-over-year Reconciliation to AFFO (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income | $2,093 | $1,408 | | (Gain) loss on disposition of assets, net | $(763) | $86 | | Depreciation, depletion and amortization | $1,173 | $1,481 | | FFO | $2,503 | $2,975 | | Adjustments (Stock comp, etc.) | $(219) | $(191) | | AFFO | $2,284 | $2,784 | Reconciliation to Adjusted EBITDAre (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income | $2,093 | $1,408 | | Interest expense | $2,638 | $5,036 | | Depreciation, etc. | $1,173 | $1,481 | | (Gain) loss on disposition | $(763) | $86 | | EBITDAre | $5,158 | $8,030 | | Adjustments (Stock comp, etc.) | $524 | $552 | | Adjusted EBITDAre | $5,682 | $8,582 | Reconciliation to NOI (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total operating revenues | $10,252 | $11,990 | | Property operating expenses | $1,480 | $1,798 | | Cost of goods sold | $664 | $541 | | NOI | $8,108 | $9,651 | Non-GAAP Financial Measures Definitions FFO and AFFO FFO and AFFO are key non-GAAP performance measures, with FFO reflecting core operational performance per Nareit standards, and AFFO further adjusting for non-sustainable items like acquisition costs and stock-based compensation - FFO is calculated according to Nareit standards and is used as a starting point to measure operational performance by excluding items like property sales gains and real estate depreciation[21] - AFFO adjusts FFO to exclude items like acquisition costs and stock-based compensation, aiming to provide a clearer view of the sustainability of ongoing operating performance[22][23] EBITDAre, Adjusted EBITDAre, and NOI EBITDAre and Adjusted EBITDAre are Nareit-defined measures for operating performance, while NOI directly assesses farmland portfolio performance by excluding corporate overhead and financing costs - EBITDAre is calculated per Nareit standards. The company uses Adjusted EBITDAre, which further excludes items like stock-based compensation, to better reflect business operating performance[24][25] - NOI is defined as total operating revenues less property operating expenses and cost of goods sold. It reflects revenues and expenses directly associated with owning and leasing farmland[27]