Alpine me Property Trust(US:PINE)2023-07-21 17:45Financial Data and Key Metrics Changes - For the second quarter of 2023, FFO and AFFO were both $0.37 per share, representing a 21% decrease compared to the second quarter of 2022 [42][56] - Year-to-date, FFO was $0.72 per share, and AFFO was $0.73 per share, reflecting year-over-year decreases of 25.8% and 23.2%, respectively [6] - The company paid a cash dividend of $0.27.50 per share for Q2 2023, a 1.9% year-over-year increase, with a current annualized yield of nearly 7% [6] Business Line Data and Key Metrics Changes - The company sold nearly $23 million of properties at a 6.4% cash cap rate during Q2 2023, focusing on non-investment-grade rated tenants [56] - Year-to-date, the company has sold $79 million of assets at a cash cap rate of 6.2%, generating gains of $5.2 million [56] - The company invested over $60 million at a 6.8% cash cap rate during the quarter, with 85% of the annualized base rent coming from investment-grade credit tenants [56] Market Data and Key Metrics Changes - Portfolio occupancy was 99.5% at the end of the quarter, consisting of 143 properties totaling 3.9 million square feet across 34 states [42] - The company raised its investment-grade tenant exposure from 48% to 63% in just 12 months [40] Company Strategy and Development Direction - The company is focused on asset recycling to improve portfolio quality and bolster the balance sheet, having sold nearly $235 million of properties below a 6.4% cash cap rate [40] - The board approved an expanded share repurchase program up to $15 million to address the disconnect between stock price and underlying value [41] - The company is evaluating two development loan agreements anchored by industry-leading tenants, aiming for yields above year-to-date acquisition cap rates [41] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about finding good acquisition opportunities due to constraints in the debt market [59] - The company revised its 2023 guidance, reducing the top end of FFO and AFFO guidance ranges by $0.02 per share, reflecting increased asset sales and revised expectations for dispositions [43] - Management noted that sellers are becoming more realistic about pricing, with some willing to meet the market due to financial pressures [22] Other Important Information - The company has no floating rate interest rate exposure and no debt maturities until 2026, with total liquidity exceeding $225 million at quarter-end [43] - The company has reduced leverage from 8.3 times at the end of Q2 2022 to 6.4 times at the end of Q2 2023 [40] Q&A Session Summary Question: How is the company viewing new acquisitions for share repurchases? - Management indicated that they are being patient with acquisitions and will not sell just to sell, focusing on specific price points [12] Question: What is the expected cadence for acquisitions and dispositions in the back half of the year? - Management expects Q3 to be relatively even, with a slight weight towards dispositions, and Q4 to lean more towards acquisitions [62] Question: How does the company balance share buybacks with the need to scale the business? - Management acknowledged the need to balance share buybacks with growth opportunities, emphasizing the importance of maintaining a strong portfolio [67]