Urban Edge Properties(US:UE)2025-07-30 11:00Part I - Financial Information Financial Statements Presents unaudited consolidated financial statements for Urban Edge Properties and its LP, detailing balance sheets, income, equity, cash flows, and accounting notes Consolidated Financial Statements of Urban Edge Properties Presents core financial statements for Urban Edge Properties, with net income attributable to common shareholders at $66.2 million and total assets at $3.31 billion as of June 30, 2025 Consolidated Balance Sheets (In thousands) | (In thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $3,313,551 | $3,311,540 | | Real estate, net | $2,861,967 | $2,865,393 | | Cash and cash equivalents | $52,962 | $41,373 | | Total Liabilities | $1,920,947 | $1,949,816 | | Mortgages payable, net | $1,514,237 | $1,569,753 | | Unsecured credit facility | $90,000 | $50,000 | | Total Equity | $1,392,604 | $1,361,724 | Consolidated Statements of Income (In thousands, except per share) | (In thousands, except per share) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenue | $232,249 | $216,172 | | Gain on sale of real estate | $49,462 | $15,349 | | Net income | $69,175 | $34,469 | | Net income attributable to common shareholders | $66,176 | $33,362 | | Earnings per common share - Diluted | $0.53 | $0.28 | Consolidated Statements of Cash Flows (In thousands) | (In thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $76,039 | $64,158 | | Net cash provided by (used in) investing activities | $19,810 | $(121,930) | | Net cash used in financing activities | $(68,288) | $(15,270) | | Net increase (decrease) in cash | $27,561 | $(73,042) | Consolidated Financial Statements of Urban Edge Properties LP Provides consolidated financial statements for Urban Edge Properties LP, nearly identical to the REIT's, with equity split between General Partner and Limited Partners - The financial statements of UELP are substantively similar to UE, with equity divided into General Partner's capital ($1.16 billion), Limited Partners' capital ($62.4 million), and noncontrolling interests ($18.3 million) as of June 30, 2025202135 Notes to Consolidated Financial Statements Detailed notes explain accounting policies and financial activities, covering property transactions, debt, fair value, redevelopment, tenant bankruptcies, and share-based compensation - As of June 30, 2025, the company's portfolio included 68 shopping centers, two outlet centers, and two malls, totaling approximately 17.1 million square feet46 Property Acquisitions and Dispositions (In thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Acquisitions | None | 2 properties for $117,000 thousand | | Dispositions | 2 properties and 1 parcel | 2 properties | | Proceeds | $64,400 thousand | $34,800 thousand | | Gain on Sale | $49,500 thousand | $15,300 thousand | - On June 26, 2025, the company paid off a $50.2 million variable-rate mortgage using its line of credit; in Q2 2024, a foreclosure eliminated a $68.6 million mortgage liability, resulting in a $21.7 million gain on debt extinguishment8486 - The company has 20 active development projects with total estimated costs of $141.8 million, of which $76.6 million remains to be funded as of June 30, 2025103 - Tenant At Home, leasing 186,000 sq. ft. and generating $2.5 million in annual rent, filed for Chapter 11 bankruptcy on June 16, 2025, with uncertain outcomes for its two leases111 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial performance, highlighting increased net income from higher revenues and property sales, covering non-GAAP measures, liquidity, capital resources, and cash flow Results of Operations Q2 2025 net income rose to $60.8 million, driven by property sales and revenue growth, with same-property NOI increasing by 5.7% for the quarter and 4.7% for the six months Key Financial Highlights (Three Months Ended June 30) (In thousands) | (In thousands) | Q2 2025 | Q2 2024 | $ Change | | :--- | :--- | :--- | :--- | | Total revenue | $114,084 | $106,546 | $7,538 | | Depreciation and amortization | $32,602 | $39,679 | $(7,077) | | Gain on sale of real estate | $49,462 | $13,447 | $36,015 | | (Loss) gain on extinguishment of debt | $(175) | $21,699 | $(21,874) | Key Financial Highlights (Six Months Ended June 30) (In thousands) | (In thousands) | H1 2025 | H1 2024 | $ Change | | :--- | :--- | :--- | :--- | | Total revenue | $232,249 | $216,172 | $16,077 | | Depreciation and amortization | $69,797 | $78,253 | $(8,456) | | Gain on sale of real estate | $49,462 | $15,349 | $34,113 | | Gain on extinguishment of debt | $323 | $21,427 | $(21,104) | - Same-property Net Operating Income (NOI) increased by 5.7% for the three months and 4.7% for the six months ended June 30, 2025, compared to the prior year periods170 Non-GAAP Financial Measures Reconciles non-GAAP metrics: NOI, Same-Property NOI, and FFO, with Q2 2025 FFO at $43.8 million and Same-Property NOI at $61.3 million Funds From Operations (FFO) Reconciliation (In thousands) | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income | $60,793 | $32,024 | | Adjustments | (17,014) | 26,373 | | FFO applicable to diluted common shareholders | $43,779 | $58,397 | Net Operating Income (NOI) Reconciliation (In thousands) | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income | $60,793 | $32,024 | | Adjustments to reach NOI | 12,238 | 34,678 | | NOI | $73,031 | $66,702 | | Adjustments for non-same property | (11,760) | (8,761) | | Same-property NOI | $61,271 | $57,941 | Liquidity and Capital Resources Primary liquidity sources include rental income, an $800 million credit facility, and an ATM program, with $118.2 million cash and $677.9 million available credit as of June 30, 2025 - As of June 30, 2025, the company held $118.2 million in cash and equivalents and had $677.9 million available under its Revolving Credit Agreement180 Cash Flow Activities (In thousands) | (In thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $76,039 | $64,158 | | Net cash provided by (used in) investing activities | $19,810 | $(121,930) | | Net cash used in financing activities | $(68,288) | $(15,270) | - In the first six months of 2024, the company generated $47.4 million in net proceeds from its ATM program by issuing 2.7 million shares; no shares were issued in the first six months of 2025178 Quantitative and Qualitative Disclosures about Market Risk Primary market risk is interest rate fluctuations, with $90 million in variable rate debt; a 1% rate increase would raise annual interest expense by $0.9 million Interest Rate Risk Exposure (In thousands) | Debt Type | Balance (June 30, 2025) (In thousands) | Weighted Avg. Interest Rate | Effect of 1% Rate Change (In thousands) | | :--- | :--- | :--- | :--- | | Variable rate debt | $90,000 | 5.45% | $900 | | Fixed rate debt | $1,526,634 | 5.02% | N/A | - The company uses financial instruments, including one interest rate derivative designated as a cash flow hedge as of June 30, 2025, to mitigate interest rate fluctuations197 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period202205 Part II - Other Information Legal Proceedings The company is involved in ordinary course legal actions, with outcomes not expected to materially affect financial position or results of operations - The company states that ordinary course legal proceedings are not expected to materially affect its financial condition207 Risk Factors No material changes to risk factors were reported from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024, were reported208 Unregistered Sales of Equity Securities and Use of Proceeds The company did not repurchase shares in Q2 2025, with approximately $145.9 million remaining available under the share repurchase program as of June 30, 2025 - The company did not repurchase shares during the three months ended June 30, 2025, with approximately $145.9 million remaining under the share repurchase program209 Defaults Upon Senior Securities No defaults upon senior securities were reported - No defaults upon senior securities were reported213 Other Information No trustees or officers adopted, terminated, or modified Rule 10b5-1 trading arrangements during Q2 2025 - No company trustees or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement during the quarter215 Exhibits Lists exhibits filed with Form 10-Q, including CEO/CFO certifications and Inline XBRL data files