The St. Joe pany(JOE) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - For Q4 2025, the company reported a 24% increase in revenue and a 58% increase in net income year-over-year [4] - Full year revenue increased by 27% to $513.2 million from $402.7 million, and net income increased by 56% to $115.6 million from $74.2 million [5] - Earnings per share rose to $2 from $1.27, marking the first time in 23 years that the company reached this level [6] Business Line Data and Key Metrics Changes - Homesite gross margins increased to 51% from 47%, while leasing gross margins rose to 57% from 54% [7] - Hospitality gross margins slightly decreased to 31% from 32%, attributed to opening expenses related to new facilities [7] Market Data and Key Metrics Changes - The company has local and state government approval for 10 Detailed Specific Area Plans (DSAPs), with only 3 currently under development, indicating significant future growth potential [9] - The residential home site pipeline increased by 2,200 home sites to approximately 23,900 at the end of the year [9] Company Strategy and Development Direction - The company aims to continue growing its recurring revenue, which is now 56% of total revenue, as part of a more sustainable business model [6][34] - Plans for breaking ground on new commercial buildings and an apartment complex in 2026 were discussed, reflecting ongoing expansion efforts [10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the performance of the new Delta flight from New York, indicating it has been well-received and could lead to increased demand for hospitality offerings [42] - The company is cautiously optimistic about the progress of the FSU Health Campus, which is expected to be a significant catalyst for regional growth [23] Other Important Information - The company has accelerated stock repurchases, with $15.1 million spent in Q4 2025, the highest in any quarter of the year [5][8] - The company is exploring AI as a tool to improve operations, reflecting a commitment to leveraging emerging technologies [35] Q&A Session Summary Question: Are there any new multifamily units on the horizon for 2026 or 2027? - The company plans to break ground on a new apartment complex near the FSU Health campus and is constantly evaluating opportunities for new hotels and acquisitions [12] Question: Any new developments coming in the near future for the Pier Park area? - The company is planning Pier Park East, which will include a surf park as a second anchor alongside Topgolf, with infrastructure development expected to begin in 2026 [14] Question: Does management still view buybacks as a prudent allocation of capital at the current share price? - Management confirmed that stock buybacks remain a component of their capital allocation strategy, depending on market conditions [15] Question: Can you help break down the 47% year-over-year increase in real estate revenue in Q4? - The increase was attributed to higher average sales prices, new residuals, and normal land sales [18] Question: What is the status of the Pigeon Creek neighborhood? - Discussions are ongoing with a builder for the Pigeon Creek project, which has over 3,000 potential units, and management is optimistic about moving forward [21] Question: How is the brokerage business progressing? - The company has received positive feedback from agents interested in joining their brokerage, indicating strong initial reception [43]