Financial Data and Key Metrics Changes - For the second quarter, the company recorded a net loss of approximately $7.9 million and a net loss to common shareholders of $13.9 million, or $0.38 per share [36] - Adjusted FFO was negative $3.4 million compared to a positive $3.7 million, or $0.10 per share, in the same quarter last year [36] - Fixed base cash rents decreased by about $6.8 million from the prior year quarter due to vacancies and structural changes in lease agreements [36][37] - The company expects a reduction in fixed base rents by about $17 million for fiscal year 2025 compared to 2024 [38] Business Line Data and Key Metrics Changes - The company has modified lease structures on certain farms, transitioning from fixed rents to crop share agreements, which will impact revenue recognition [11][36] - Four new standard lease agreements were entered into during the quarter, expected to increase annual NOI by about $166,000 or approximately 9% [15] - Participation rents were down year over year, largely due to the accelerated recognition of certain revenue in 2024 [37] Market Data and Key Metrics Changes - The almond market has shown signs of recovery, with prices recently increasing by 5% to 8% after a previous drop of 20% [25] - Pistachio markets are experiencing strong demand, with the 2025 crop expected to be the largest on record [29] - Wine grape markets remain low, but there have been recent inquiries for contracts at significantly higher prices than a year ago [27] Company Strategy and Development Direction - The company is focusing on improving water security and delivery infrastructure across its portfolio, with significant investments in water assets [33][90] - The strategy includes transitioning back to traditional lease structures with fixed base rents as market conditions improve [12][46] - The company remains cautious about new investments due to high costs of capital and ongoing challenges in the farming sector [7][46] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for increased profits in the fourth quarter as crop sales are expected to improve [44] - The company is monitoring the impact of rising interest rates and changes in the agricultural market, particularly regarding the profitability of nut crops [46][48] - Management highlighted the importance of healthy food trends and the stability of demand for prime farmland [49] Other Important Information - The company has over $150 million in available capital and nearly $170 million in unpledged properties that could serve as collateral [42] - The monthly dividend declared was $0.0467 per share, representing a 6.1% annualized yield, which is above the REIT sector average [43] Q&A Session Summary Question: Follow-up on participation rents and expected amounts for 2025 - Management indicated that the split between this year and next year for the $17 million in participation rents is estimated at 60% to 65% this year, with the remainder in the following year [51] Question: Expectations for Series D redemption in January 2026 - Management is keeping options open, including potential property sales or using lines of credit to address the Series D redemption [55] Question: Impact of Sigma on properties and water needs - Management noted that while they are currently in good shape regarding water, regulatory changes from Sigma are ongoing and could impact future operations [80][87]