Saul Centers, Inc. Reports Second Quarter 2024 Earnings
Same property revenue increased
Same property revenue and same property operating income are non-GAAP financial measures of performance and improve the comparability of these measures by excluding the results of properties that were not in operation for the entirety of the comparable reporting periods. We define same property revenue as total revenue minus the revenue of properties not in operation for the entirety of the comparable reporting periods. We define same property operating income as net income plus (a) interest expense, net and amortization of deferred debt costs, (b) depreciation and amortization of deferred leasing costs, (c) general and administrative expenses, (d) change in fair value of derivatives, and (e) loss on early extinguishment of debt minus (f) gains on sale and disposition of property and (g) the results of properties not in operation for the entirety of the comparable periods.
Funds from operations ("FFO") available to common stockholders and noncontrolling interests (after deducting preferred stock dividends) increased to
As of
For the six months ended
Same property revenue increased $6.9 million, or 5.4%, and same property operating income increased
FFO available to common stockholders and noncontrolling interests, after deducting preferred stock dividends, increased to
Safe Harbor Statement
Certain matters discussed within this press release may be deemed to be forward-looking statements within the meaning of the federal securities laws. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. These factors include, but are not limited to, the risk factors described in our Annual Report on (i) Form 10-K for the year ended
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(Dollars in thousands, except per share amounts) |
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Assets |
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Real estate investments |
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Land |
$ 501,787 |
|
$ 511,529 |
Buildings and equipment |
1,604,330 |
|
1,595,023 |
Construction in progress |
615,166 |
|
514,553 |
|
2,721,283 |
|
2,621,105 |
Accumulated depreciation |
(748,750) |
|
(729,470) |
Total real estate investments, net |
1,972,533 |
|
1,891,635 |
Cash and cash equivalents |
6,863 |
|
8,407 |
Accounts receivable and accrued income, net |
53,328 |
|
56,032 |
Deferred leasing costs, net |
25,834 |
|
23,728 |
Other assets |
13,039 |
|
14,335 |
Total assets |
$ 2,071,597 |
|
$ 1,994,137 |
Liabilities |
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Mortgage notes payable, net |
$ 966,132 |
|
$ 935,451 |
Revolving credit facility payable, net |
235,102 |
|
274,715 |
Term loan facility payable, net |
99,605 |
|
99,530 |
Construction loans payable, net |
141,765 |
|
77,305 |
Accounts payable, accrued expenses and other liabilities |
72,317 |
|
57,022 |
Deferred income |
20,416 |
|
22,748 |
Dividends and distributions payable |
23,240 |
|
22,937 |
Total liabilities |
1,558,577 |
|
1,489,708 |
Equity |
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Preferred stock, 1,000,000 shares authorized: |
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Series D Cumulative Redeemable, 30,000 shares issued and outstanding |
75,000 |
|
75,000 |
Series E Cumulative Redeemable, 44,000 shares issued and outstanding |
110,000 |
|
110,000 |
Common stock, |
241 |
|
241 |
Additional paid-in capital |
451,845 |
|
449,959 |
Distributions in excess of accumulated net income |
(294,852) |
|
(288,825) |
Accumulated other comprehensive income |
3,434 |
|
2,014 |
|
345,668 |
|
348,389 |
Noncontrolling interests |
167,352 |
|
156,040 |
Total equity |
513,020 |
|
504,429 |
Total liabilities and equity |
$ 2,071,597 |
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$ 1,994,137 |
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Three Months Ended |
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Six Months Ended |
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2024 |
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2023 |
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2024 |
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2023 |
Revenue |
(unaudited) |
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(unaudited) |
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Rental revenue |
$ 63,695 |
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$ 62,002 |
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$ 128,994 |
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$ 123,830 |
Other |
3,248 |
|
1,707 |
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4,641 |
|
2,928 |
Total revenue |
66,943 |
|
63,709 |
|
133,635 |
|
126,758 |
Expenses |
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Property operating expenses |
9,656 |
|
8,997 |
|
20,201 |
|
17,783 |
Real estate taxes |
7,608 |
|
7,453 |
|
15,232 |
|
14,948 |
Interest expense, net and amortization of deferred debt |
12,267 |
|
12,278 |
|
24,715 |
|
24,099 |
Depreciation and amortization of deferred leasing costs |
12,001 |
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12,114 |
|
24,030 |
|
24,130 |
General and administrative |
6,102 |
|
5,678 |
|
11,885 |
|
10,946 |
Total expenses |
47,634 |
|
46,520 |
|
96,063 |
|
91,906 |
Gain on disposition of property |
181 |
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— |
|
181 |
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— |
Net Income |
19,490 |
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17,189 |
|
37,753 |
|
34,852 |
Noncontrolling interests |
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Income attributable to noncontrolling interests |
(5,042) |
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(4,027) |
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(9,675) |
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(8,188) |
Net income attributable to |
14,448 |
|
13,162 |
|
28,078 |
|
26,664 |
Preferred stock dividends |
(2,799) |
|
(2,799) |
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(5,597) |
|
(5,597) |
Net income available to common stockholders |
$ 11,649 |
|
$ 10,363 |
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$ 22,481 |
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$ 21,067 |
Per share net income available to common |
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Basic and diluted |
$ 0.48 |
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$ 0.43 |
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$ 0.93 |
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$ 0.88 |
Reconciliation of net income to FFO available to common stockholders and noncontrolling interests (1) |
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Three Months Ended |
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Six Months Ended |
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(In thousands, except per share amounts) |
2024 |
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2023 |
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2024 |
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2023 |
Net income |
$ 19,490 |
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$ 17,189 |
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$ 37,753 |
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$ 34,852 |
Subtract: |
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Gain on disposition of property |
(181) |
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— |
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(181) |
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— |
Add: |
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Real estate depreciation and amortization |
12,001 |
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12,114 |
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24,030 |
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24,130 |
FFO |
31,310 |
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29,303 |
|
61,602 |
|
58,982 |
Subtract: |
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Preferred stock dividends |
(2,799) |
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(2,799) |
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(5,597) |
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(5,597) |
FFO available to common stockholders and noncontrolling |
$ 28,511 |
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$ 26,504 |
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$ 56,005 |
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$ 53,385 |
Weighted average shares and units: |
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Basic |
34,498 |
|
33,340 |
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34,423 |
|
33,332 |
Diluted (2) |
34,502 |
|
34,049 |
|
34,427 |
|
34,040 |
Basic FFO per share available to common stockholders and |
$ 0.83 |
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$ 0.79 |
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$ 1.63 |
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$ 1.60 |
Diluted FFO per share available to common stockholders and |
$ 0.83 |
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$ 0.78 |
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$ 1.63 |
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$ 1.57 |
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(1) |
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(2) |
Beginning |
Reconciliation of revenue to same property revenue (1) |
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(in thousands) |
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Three Months Ended |
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Six Months Ended |
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2024 |
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2023 |
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2024 |
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2023 |
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(unaudited) |
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(unaudited) |
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Total revenue |
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$ 66,943 |
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$ 63,709 |
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$ 133,635 |
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$ 126,758 |
Less: Acquisitions, dispositions and development properties |
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— |
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— |
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— |
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— |
Total same property revenue |
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$ 66,943 |
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$ 63,709 |
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$ 133,635 |
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$ 126,758 |
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Shopping Centers |
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$ 46,765 |
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$ 43,974 |
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$ 93,698 |
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$ 88,199 |
Mixed-Use properties |
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20,178 |
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19,735 |
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39,937 |
|
38,559 |
Total same property revenue |
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$ 66,943 |
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$ 63,709 |
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$ 133,635 |
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$ 126,758 |
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$ 46,765 |
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$ 43,974 |
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$ 93,698 |
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$ 88,199 |
Less: Shopping Center acquisitions, dispositions and |
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— |
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— |
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— |
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— |
Total same Shopping Center revenue |
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$ 46,765 |
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$ 43,974 |
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$ 93,698 |
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$ 88,199 |
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Total Mixed-Use property revenue |
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$ 20,178 |
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$ 19,735 |
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$ 39,937 |
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$ 38,559 |
Less: Mixed-Use acquisitions, dispositions and development properties |
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— |
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— |
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— |
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— |
Total same Mixed-Use property revenue |
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$ 20,178 |
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$ 19,735 |
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$ 39,937 |
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$ 38,559 |
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(1) |
Same property revenue is a non-GAAP financial measure of performance that management believes improves the comparability of reporting periods by excluding the results of properties that were not in operation for the entirety of the comparable reporting periods. Same property revenue adjusts property revenue by subtracting the revenue of properties not in operation for the entirety of the comparable reporting periods. Same property revenue is a measure of the operating performance of the Company's properties but does not measure the Company's performance as a whole. Same property revenue should not be considered as an alternative to total revenue, its most directly comparable GAAP measure, as an indicator of the Company's operating performance. Management considers same property revenue a meaningful supplemental measure of operating performance because it is not affected by the cost of the Company's funding, the impact of depreciation and amortization expenses, gains or losses from the acquisition and sale of operating real estate assets, general and administrative expenses or other gains and losses that relate to ownership of the Company's properties. Management believes the exclusion of these items from same property revenue is useful because the resulting measure captures the actual revenue generated by operating the Company's properties. Other REITs may use different methodologies for calculating same property revenue. Accordingly, the Company's same property revenue may not be comparable to those of other REITs. |
Mixed-Use same property revenue is composed of the following: |
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Three Months Ended |
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Six Months Ended |
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(In thousands) |
|
2024 |
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2023 |
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2024 |
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2023 |
Office mixed-use properties (1) |
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$ 10,062 |
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$ 9,856 |
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$ 19,815 |
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$ 19,001 |
Residential mixed-use properties (residential activity) (2) |
|
8,968 |
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8,737 |
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17,806 |
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17,270 |
Residential mixed-use properties (retail activity) (3) |
|
1,148 |
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1,142 |
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2,316 |
|
2,288 |
Total Mixed-Use same property revenue |
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$ 20,178 |
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$ 19,735 |
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$ 39,937 |
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$ 38,559 |
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(1) |
Includes Avenel Business Park, Clarendon Center – North and South Blocks, 601 Pennsylvania Avenue and |
(2) |
Includes Clarendon South Block, The Waycroft and |
(3) |
Includes The Waycroft and |
Reconciliation of net income to same property operating income (1) |
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Three Months Ended |
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Six Months Ended |
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(In thousands) |
2024 |
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2023 |
|
2024 |
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2023 |
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(unaudited) |
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(unaudited) |
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Net income |
$ 19,490 |
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$ 17,189 |
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$ 37,753 |
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$ 34,852 |
Add: Interest expense, net and amortization of deferred debt costs |
12,267 |
|
12,278 |
|
24,715 |
|
24,099 |
Add: Depreciation and amortization of deferred leasing costs |
12,001 |
|
12,114 |
|
24,030 |
|
24,130 |
Add: General and administrative |
6,102 |
|
5,678 |
|
11,885 |
|
10,946 |
Less: Gain on disposition of property |
(181) |
|
— |
|
(181) |
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— |
Property operating income |
49,679 |
|
47,259 |
|
98,202 |
|
94,027 |
Less: Acquisitions, dispositions and development properties |
— |
|
— |
|
— |
|
— |
Total same property operating income |
$ 49,679 |
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$ 47,259 |
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$ 98,202 |
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$ 94,027 |
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Shopping Centers |
$ 36,812 |
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$ 34,512 |
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$ 72,781 |
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$ 69,477 |
Mixed-Use properties |
12,867 |
|
12,747 |
|
25,421 |
|
24,550 |
Total same property operating income |
$ 49,679 |
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$ 47,259 |
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$ 98,202 |
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$ 94,027 |
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Shopping Center operating income |
$ 36,812 |
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$ 34,512 |
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$ 72,781 |
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$ 69,477 |
Less: Shopping Center acquisitions, dispositions and development |
— |
|
— |
|
— |
|
— |
Total same Shopping Center operating income |
$ 36,812 |
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$ 34,512 |
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$ 72,781 |
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$ 69,477 |
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Mixed-Use property operating income |
$ 12,867 |
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$ 12,747 |
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$ 25,421 |
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$ 24,550 |
Less: Mixed-Use acquisitions, dispositions and development properties |
— |
|
— |
|
— |
|
— |
Total same Mixed-Use property operating income |
$ 12,867 |
|
$ 12,747 |
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$ 25,421 |
|
$ 24,550 |
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(1) |
Same property operating income is a non-GAAP financial measure of performance that management believes improves the comparability of reporting periods by excluding the results of properties that were not in operation for the entirety of the comparable reporting periods. Same property operating income adjusts property operating income by subtracting the results of properties that were not in operation for the entirety of the comparable periods. Same property operating income is a measure of the operating performance of the Company's properties but does not measure the Company's performance as a whole. Same property operating income should not be considered as an alternative to property operating income, its most directly comparable GAAP measure, as an indicator of the Company's operating performance. Management considers same property operating income a meaningful supplemental measure of operating performance because it is not affected by the cost of the Company's funding, the impact of depreciation and amortization expenses, gains or losses from the acquisition and sale of operating real estate assets, general and administrative expenses or other gains and losses that relate to ownership of the Company's properties. Management believes the exclusion of these items from property operating income is useful because the resulting measure captures the actual revenue generated and actual expenses incurred by operating the Company's properties. Other REITs may use different methodologies for calculating same property operating income. Accordingly, same property operating income may not be comparable to those of other REITs. |
Mixed-Use same property operating income is composed of the following: |
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Three Months Ended |
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Six Months Ended |
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(In thousands) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Office mixed-use properties (1) |
|
$ 6,577 |
|
$ 6,469 |
|
$ 12,797 |
|
$ 12,177 |
Residential mixed-use properties (residential activity) (2) |
|
5,451 |
|
5,438 |
|
10,923 |
|
10,726 |
Residential mixed-use properties (retail activity) (3) |
|
839 |
|
840 |
|
1,701 |
|
1,647 |
Total Mixed-Use same property operating income |
|
$ 12,867 |
|
$ 12,747 |
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$ 25,421 |
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$ 24,550 |
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(1) |
Includes Avenel Business Park, Clarendon Center – North and South Blocks, 601 Pennsylvania Avenue and |
(2) |
Includes Clarendon South Block, The Waycroft and |
(3) |
Includes The Waycroft and |
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