Financial Data and Key Metrics Changes - Second quarter revenue was 7.2 million in Q2 2023 [12] - Net operating income (NOI) was 4.9 million in the same quarter last year [14] - Adjusted EBITDA was 3.6 million in the prior year [15] - Cash and restricted cash at the end of Q2 was 192 million, a slight decrease from year-end 2023 [15] Business Line Data and Key Metrics Changes - The asset portfolio includes 42 parking properties, 18 garages, and 24 surface parking lots, with a focus on management contracts [4][5] - The conversion to management contracts has allowed for better control of expenses and improved visibility into parking usage and demand metrics [5][6] - NOI growth primarily came from managed locations, indicating a successful shift in the business model [14] Market Data and Key Metrics Changes - The Midwest remains the strongest market for the company, with continued strength in monthly parking for medical and social service facilities [7] - There are early signs of demand pickup expected to materialize in 2025, driven by the conversion of Class B office space into residential units [8] - Contract parkers increased from 6,500 to 6,900, indicating a potential return to office trend [9] Company Strategy and Development Direction - The company aims to become the acquirer of choice in a fragmented parking industry, with a sizable pipeline of potential acquisitions [18] - Management is focused on operational improvements and debt refinancing to position the company for growth [10][11] - The strategy includes leveraging micro market relationships to enhance pricing and utilization [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term strategy and opportunities for shareholder value creation despite recent stock performance [17] - The company is experiencing a challenging economic environment but is optimistic about future demand due to ongoing market shifts [9][11] - Management is actively addressing the pressure from preferred equity conversions to common stock, which has affected stock performance [11][18] Other Important Information - The internal NAV calculation was disclosed as $7.25 per share, indicating that the stock price is undervalued [10] - The company plans to update the NAV metric periodically to provide investors with a method to track financial progress [10] Q&A Session Summary Question: Can you provide data on actual property utilization and revenue per lot? - Management acknowledged the challenge of consolidating real-time utilization data but mentioned a concept of revenue per available space (RevPars) as a placeholder [19] Question: Are you seeing assets trade in the marketplace? - Management noted that not many assets are trading yet, but there are opportunities related to office towers being returned to lenders [20] Question: Can you elaborate on the office to residential conversions? - Management is engaged with developers to tailor parking options for new residential units, which could increase utilization and revenue [21] Question: What is the status of preferred equity conversion to common stock? - Approximately 25% of preferred equity has been converted to common stock, with ongoing discussions on how to manage this pressure [22] Question: What is the current state of return to office trends? - Management observed that certain weekdays are busier than others, with a gradual return of employees to offices, particularly in hospitality and municipal sectors [24][25] Question: How are you adjusting pricing for the return to office? - Management is currently discounting rates to drive volume, with plans to adjust pricing as utilization increases [26][27] Question: When will the benefits from residential conversions be realized? - Management expects to see benefits from residential conversions in the latter part of this year, with significant growth anticipated in 2025 [28]
Mobile Infrastructure (BEEP) - 2024 Q2 - Earnings Call Transcript