BPG(US:BRX)2023-04-30 16:00Part I - FINANCIAL INFORMATION Financial Statements The unaudited condensed consolidated financial statements for the quarterly period ended March 31, 2023 are presented Brixmor Property Group Inc. Financial Statements Condensed consolidated financial statements for Brixmor Property Group Inc for the three months ended March 31, 2023 Condensed Consolidated Statements of Operations (Brixmor Property Group Inc.) (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Total Revenues | $311,444 | $298,629 | | Total Operating Expenses | $198,596 | $193,248 | | Net Income | $112,246 | $79,506 | | Diluted EPS | $0.37 | $0.26 | Condensed Consolidated Balance Sheet Highlights (Brixmor Property Group Inc.) (in thousands) | Metric | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Real estate, net | $7,835,257 | $7,901,592 | | Total Assets | $8,354,798 | $8,435,930 | | Debt obligations, net | $4,958,480 | $5,035,501 | | Total Liabilities | $5,467,282 | $5,570,920 | | Total Equity | $2,887,516 | $2,865,010 | Condensed Consolidated Statements of Cash Flows (Brixmor Property Group Inc.) (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $135,054 | $112,260 | | Net cash provided by (used in) investing activities | $48,485 | ($174,937) | | Net cash used in financing activities | ($169,369) | ($194,682) | | Net change in cash, cash equivalents and restricted cash | $14,170 | ($257,359) | Brixmor Operating Partnership LP Financial Statements Condensed consolidated financial statements for Brixmor Operating Partnership LP for the three months ended March 31, 2023 - The financial statements of the Operating Partnership are materially the same as the Parent Company's, with the primary difference being in the capital section164274 Condensed Consolidated Statements of Operations (Brixmor Operating Partnership LP) (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Total Revenues | $311,444 | $298,629 | | Total Operating Expenses | $198,596 | $193,248 | | Net Income | $112,246 | $79,506 | Condensed Consolidated Statements of Cash Flows (Brixmor Operating Partnership LP) (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $135,054 | $112,260 | | Net cash provided by (used in) investing activities | $48,485 | ($174,937) | | Net cash used in financing activities | ($168,442) | ($186,052) | | Net change in cash, cash equivalents and restricted cash | $15,097 | ($248,729) | Notes to Condensed Consolidated Financial Statements Detailed notes accompany the financial statements, covering key accounting policies, business activities, and other disclosures - The company is an internally-managed REIT owning and operating one of the largest publicly-traded open-air retail portfolios in the U.S, comprising 367 shopping centers totaling approximately 65 million square feet of GLA as of March 31, 2023296 - The company did not acquire any assets during Q1 2023, compared to three shopping centers and one land parcel acquired for $158.2 million in Q1 202260146 - During Q1 2023, the company disposed of six shopping centers and two partial shopping centers for aggregate net proceeds of $119.7 million, resulting in a gain of $48.5 million301 - As of March 31, 2023, total debt obligations, net, were approximately $5.0 billion, and the company was in compliance with all financial covenants with no scheduled debt maturities for the next 12 months857778 - Subsequent to the quarter end, the Operating Partnership repurchased $199.6 million of its 3.65% Senior Notes due 2024 via a cash tender offer, funded by a $200.0 million delayed draw term loan138 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's Q1 2023 financial condition, operational results, liquidity, and non-GAAP measures Executive Summary and Highlights The company's strategy focuses on portfolio management and reinvestment, with strong Q1 2023 leasing activity - The company's primary objective is to maximize total returns through consistent, sustainable growth in cash flow, driven by proactive portfolio management and value-enhancing reinvestments155 - As of March 31, 2023, billed and leased occupancy increased to 90.0% and 94.0%, respectively, from 88.6% and 92.1% a year prior144 Leasing Activity Highlights (Q1 2023) | Lease Type | Leases | GLA (sq ft) | New ABR PSF | Rent Spread (Comparable Leases) | | :--- | :--- | :--- | :--- | :--- | | Total | 374 | 2,307,147 | $15.55 | 13.1% | | New Leases | 149 | 779,954 | $17.63 | 35.9% | | Renewal Leases | 172 | 610,198 | $20.14 | 12.1% | Results of Operations Total revenues grew by $12.8 million in Q1 2023, driven by higher rental income and offset by increased operating expenses Comparison of Revenues (in thousands) | Revenue Type | Q1 2023 | Q1 2022 | $ Change | | :--- | :--- | :--- | :--- | | Rental income | $311,130 | $298,362 | $12,768 | | Total revenues | $311,444 | $298,629 | $12,815 | Comparison of Operating Expenses (in thousands) | Expense Type | Q1 2023 | Q1 2022 | $ Change | | :--- | :--- | :--- | :--- | | Operating costs | $35,895 | $34,796 | $1,099 | | Real estate taxes | $44,688 | $41,640 | $3,048 | | Depreciation and amortization | $87,741 | $84,222 | $3,519 | | Impairment of real estate assets | $1,100 | $4,590 | ($3,490) | | General and administrative | $29,172 | $28,000 | $1,172 | | Total operating expenses | $198,596 | $193,248 | $5,348 | - The gain on sale of real estate assets increased to $48.5 million in Q1 2023 from $21.9 million in Q1 2022, reflecting a higher volume of disposition activity153190 Liquidity and Capital Resources The company maintains a strong liquidity position with $1.44 billion available and increased operating cash flow - As of March 31, 2023, the company had $1.44 billion of available liquidity, comprising $1.20 billion under the Revolving Facility, $200.0 million under the Term Loan Facility, and $35.4 million in cash179 - Net cash provided by operating activities increased by $22.8 million in Q1 2023 versus Q1 2022, primarily due to higher same property net operating income199 - The company is actively managing a portfolio of 47 in-process redevelopment and development projects with an aggregate anticipated cost of $360.0 million201 Non-GAAP Performance Measures The company utilizes Nareit FFO and Same Property NOI to evaluate operating performance, showing growth in both measures Nareit FFO Reconciliation (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net income | $112,246 | $79,506 | | Depreciation and amortization related to real estate | $86,748 | $83,190 | | Gain on sale of real estate assets | ($48,468) | ($21,911) | | Impairment of real estate assets | $1,100 | $4,590 | | Nareit FFO | $151,626 | $145,375 | | Nareit FFO per diluted share | $0.50 | $0.49 | Same Property NOI (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | % Change | | :--- | :--- | :--- | :--- | | Revenues | $286,340 | $273,928 | | | Operating Expenses | ($74,382) | ($71,819) | | | Same property NOI | $211,958 | $202,109 | 4.9% | Quantitative and Qualitative Disclosures about Market Risk No material changes were reported from the market risk disclosures in the 2022 Annual Report on Form 10-K - There were no material changes to the company's market risk disclosures from the Form 10-K for the year ended December 31, 2022244 Controls and Procedures Disclosure controls and procedures were deemed effective as of March 31, 2023, with no material changes in internal control - The principal executive officer and principal financial officer concluded that the disclosure controls and procedures for both Brixmor Property Group Inc and the Operating Partnership were effective as of March 31, 2023245230 - There were no changes in internal control over financial reporting during the first quarter of 2023 that have materially affected, or are reasonably likely to materially affect, the company's internal control229247 Part II - OTHER INFORMATION Legal Proceedings The company is not involved in any material litigation outside the ordinary course of business - The company is not presently involved in any material litigation outside the ordinary course of business125248 Risk Factors No material changes were reported to the risk factors disclosed in the 2022 Annual Report on Form 10-K - There have been no material changes to the risk factors relating to the Company as disclosed in the Form 10-K for the year ended December 31, 2022233 Unregistered Sales of Equity Securities and Use of Proceeds No common stock was repurchased in Q1 2023, with $400.0 million remaining available under the repurchase program - During Q1 2023, the Company did not repurchase any of its common stock234 - As of March 31, 2023, the company's share repurchase program had $400.0 million of available capacity234108 Defaults Upon Senior Securities No defaults upon senior securities occurred during the reporting period - None234 Other Information No other material information was reported for the period - None235 Exhibits Filed exhibits include CEO/CFO certifications and XBRL interactive data files - Exhibits filed with this report include certifications from the Chief Executive Officer and Chief Financial Officer under Sections 302 and 906 of the Sarbanes-Oxley Act, as well as XBRL data files251