Gladstone Land(US:LAND)2024-08-09 14:51Financial Data and Key Metrics Changes - The company reported a net loss of $823,000 for the second quarter, with a net loss to common shareholders of $6.7 million or $0.19 per share [22] - Adjusted FFO for the current quarter was approximately $3.7 million or $0.103 per share, compared to $3.6 million or $0.102 per share in the prior year quarter [22] - Dividends declared per common share increased to $0.140 in the current quarter from $0.138 in the prior year quarter [22] Business Line Data and Key Metrics Changes - Fixed base cash rents decreased by about $1.1 million year-over-year, primarily due to lost revenue from a sold farm and other properties [23] - Participation rents increased by $1.1 million during the current quarter, largely due to additional information related to prior harvests [23] Market Data and Key Metrics Changes - The company owns approximately 112,000 acres on 168 farms, with a total value of about $1.5 billion [7] - The company executed 11 new or amended leases, resulting in an expected increase in annual net operating income of about $465,000 [8] Company Strategy and Development Direction - The company remains cautious on acquisition activity due to high capital costs and is focused on evaluating profitability outlooks for certain permanent crop farms [29] - The company is actively acquiring water assets to enhance farm desirability and mitigate water supply issues [10][14] Management's Comments on Operating Environment and Future Outlook - Management noted that while crop prices for almonds and pistachios have been depressed, there are signs of recovery, particularly in exports [11][12] - The company is optimistic about future price increases for almonds and pistachios, driven by strong demand, especially in India [13][31] Other Important Information - The company has access to about $180 million in liquidity, including over $30 million in cash [26] - The net asset value per common share decreased to $17.59 from $18.50 due to decreases in valuations of certain farms [26] Q&A Session Summary Question: What is the exposure of the portfolio to almonds and pistachios? - Approximately 20% of revenue is from pistachios and about 8-9% from almonds [36] Question: What are the current interest rates for refinancing the $46 million debt expiring in the next 12 months? - The weighted average interest rate is about 3.4%, with potential refinancing rates expected to be around 200 basis points higher [38] Question: Are the vacant farms all related to nuts? - Yes, all the vacant farms are related to nuts [40] Question: What is the outlook for participation rents in the second half of 2024? - Participation rents collected in 2023 were minimal, and expectations for 2024 are uncertain but may be similar to previous years [44][50] Question: What assets are being considered for potential dispositions? - The company is evaluating assets, particularly those with poor performance due to current market conditions for almonds and pistachios [52]