STOCK TITAN

Alexander & Baldwin, Inc. Reports Third Quarter 2024 Results

Rhea-AI Impact
(Neutral)
Rhea-AI Sentiment
(Neutral)
Tags

Alexander & Baldwin (NYSE: ALEX) reported strong Q3 2024 results with net income of $19.0 million ($0.26 per diluted share) and Commercial Real Estate operating profit of $22.8 million. The company achieved FFO of $28.2 million ($0.39 per diluted share) and Adjusted FFO of $23.4 million ($0.32 per diluted share). Key highlights include 4.1% CRE Same-Store NOI growth, 94.0% leased occupancy, and 15.3% comparable blending leasing spreads. The company completed the acquisition of an 81,500 square foot food distribution facility and raised its 2024 guidance, with revised FFO guidance of $1.27-$1.35 per diluted share.

Alexander & Baldwin (NYSE: ALEX) ha riportato risultati solidi per il terzo trimestre del 2024, con un utile netto di 19,0 milioni di dollari (0,26 dollari per azione diluita) e un profitto operativo nel settore immobiliare commerciale di 22,8 milioni di dollari. L'azienda ha raggiunto un FFO di 28,2 milioni di dollari (0,39 dollari per azione diluita) e un FFO aggiustato di 23,4 milioni di dollari (0,32 dollari per azione diluita). Tra i punti salienti si segnalano una crescita del 4,1% del NOI Same-Store nel settore CRE, una percentuale di occupazione affittata del 94,0% e una differenza di affitto comparabile di 15,3%. L'azienda ha completato l'acquisizione di un impianto di distribuzione alimentare di 81.500 piedi quadrati e ha aumentato le previsioni per il 2024, con indicazioni riviste per l'FFO tra 1,27 e 1,35 dollari per azione diluita.

Alexander & Baldwin (NYSE: ALEX) reportó resultados sólidos en el tercer trimestre de 2024, con un ingreso neto de 19,0 millones de dólares (0,26 dólares por acción diluida) y un beneficio operativo en bienes raíces comerciales de 22,8 millones de dólares. La empresa logró un FFO de 28,2 millones de dólares (0,39 dólares por acción diluida) y un FFO ajustado de 23,4 millones de dólares (0,32 dólares por acción diluida). Los aspectos más destacados incluyen un crecimiento del 4,1% en el NOI de Same-Store en el sector CRE, una ocupación arrendada del 94,0% y márgenes de arrendamiento comparables del 15,3%. La empresa completó la adquisición de una instalación de distribución de alimentos de 81,500 pies cuadrados y elevó su guía para 2024, con proyecciones revisadas de FFO entre 1,27 y 1,35 dólares por acción diluida.

알렉산더 & 볼드윈 (NYSE: ALEX)는 2024년 3분기 결과로 1,900만 달러(주당 0.26 달러)의 순이익과 2,280만 달러의 상업용 부동산 운영 이익을 보고했습니다. 이 회사는 2,820만 달러의 FFO(주당 0.39 달러)와 2,340만 달러의 조정된 FFO(주당 0.32 달러)를 달성했습니다. 주요 하이라이트에는 CRE 동일 매장 NOI 성장률 4.1%, 임대 점유율 94.0% 및 비교 가능한 임대 스프레드 15.3%이 포함됩니다. 이 회사는 81,500 평방피트의 식품 유통 시설 인수를 완료했으며, 2024년 가이던스를 상향 조정하여 조정된 FFO 가이던스를 1.27~1.35 달러로 제시했습니다.

Alexander & Baldwin (NYSE: ALEX) a annoncé de solides résultats pour le troisième trimestre 2024, avec un revenu net de 19,0 millions de dollars (0,26 dollar par action diluée) et un bénéfice d'exploitation en immobilier commercial de 22,8 millions de dollars. L'entreprise a réalisé un FFO de 28,2 millions de dollars (0,39 dollar par action diluée) et un FFO ajusté de 23,4 millions de dollars (0,32 dollar par action diluée). Parmi les points clés figurent une croissance de 4,1 % du NOI Same-Store dans le secteur CRE, un taux d'occupation locative de 94,0 % et un écart de location comparable de 15,3 %. L'entreprise a finalisé l'acquisition d'un établissement de distribution alimentaire de 81 500 pieds carrés et a relevé ses prévisions pour 2024, avec des prévisions FFO révisées de 1,27 à 1,35 dollar par action diluée.

Alexander & Baldwin (NYSE: ALEX) hat im dritten Quartal 2024 starke Ergebnisse bekannt gegeben, mit einem Nettogewinn von 19,0 Millionen Dollar (0,26 Dollar pro verwässerter Aktie) und einem Betriebsergebnis im Bereich Gewerbeimmobilien von 22,8 Millionen Dollar. Das Unternehmen erzielte ein FFO von 28,2 Millionen Dollar (0,39 Dollar pro verwässerter Aktie) und ein angepasstes FFO von 23,4 Millionen Dollar (0,32 Dollar pro verwässerter Aktie). Zu den Hauptpunkten gehören ein 4,1 % Wachstum des NOI im Same-Store-Bereich für CRE, eine vermietete Belegungsquote von 94,0 % und vergleichbare Mietspreads von 15,3 %. Das Unternehmen schloss die Übernahme einer 81.500 Quadratfuß großen Lebensmitteldistributionsanlage ab und hob seine Prognosen für 2024 an, mit überarbeiteten FFO-Prognosen von 1,27 bis 1,35 Dollar pro verwässerter Aktie.

Positive
  • Net income increased 30.1% YoY to $19.0 million from $14.6 million
  • FFO grew 33% YoY to $28.2 million from $21.2 million
  • CRE operating profit increased 10.6% to $22.8 million
  • Strong leasing spreads of 15.3% for improved portfolio
  • Industrial portfolio occupancy improved to 97.4%
  • Company raised full-year 2024 guidance
Negative
  • Overall leased occupancy decreased 60 basis points YoY to 94.0%
  • Retail portfolio occupancy declined 110 basis points YoY to 92.9%
  • Weighted-average debt maturity decreased to 2.9 years

Insights

Alexander & Baldwin delivered strong Q3 2024 results with notable improvements across key metrics. Net income increased to $19.0 million ($0.26 per share) from $14.6 million year-over-year. The company's CRE portfolio showed robust performance with 15.3% comparable leasing spreads and healthy occupancy at 94.0%.

Key financial strengths include:

  • FFO growth to $28.2 million ($0.39/share) from $21.2 million
  • Strong balance sheet with 25.3% debt-to-market cap ratio
  • Improved guidance for full-year 2024
The acquisition of an 81,500-square-foot distribution facility and establishment of a new $200 million ATM program positions the company well for future growth. The favorable debt profile, with 96.8% fixed-rate debt and a modest 3.6x Net Debt to TTM EBITDA ratio, provides financial stability.

HONOLULU, Oct. 24, 2024 /PRNewswire/ -- Alexander & Baldwin, Inc. (NYSE: ALEX) ("A&B" or "Company"), a Hawai'i-based owner, operator and developer of high-quality commercial real estate in Hawai'i, today announced net income available to A&B common shareholders of $19.0 million, or $0.26 per diluted share, and Commercial Real Estate ("CRE") operating profit of $22.8 million for the third quarter of 2024.

Q3 2024 Highlights

  • Funds From Operations ("FFO") of $28.2 million, or $0.39 per diluted share / Adjusted FFO of $23.4 million, or $0.32 per diluted share

  • CRE Same-Store Net Operating Income ("NOI") growth of 4.1% / CRE Same-Store NOI growth of 4.7% excluding collections of prior year reserves

  • Leased occupancy as of September 30, 2024, was 94.0%

  • Comparable blended leasing spreads for the improved portfolio were 15.3%

  • Closed on the acquisition of an 81,500 square foot food and distribution facility.

Lance Parker, president and chief executive officer, stated: "I am pleased with our performance during the third quarter. Our portfolio continued to demonstrate organic growth and leasing demand was healthy, as evidenced by our CRE and Corporate FFO performance. Additionally, Land Operations generated strong FFO during the quarter. As a result, we are again raising our 2024 guidance. We also completed the acquisition of an industrial asset on Oahu, and took steps to ensure we have the tools available to support growth, including establishing a new at-the-market ("ATM") equity offering program to replace our previous program that expired and also took meaningful steps in the third quarter that enabled us to recast our revolving credit facility in the fourth quarter, extending our maturity date into 2028."

Financial Results for Q3 2024

  • Net income available to A&B common shareholders and diluted earnings per share available to A&B shareholders for the third quarter of 2024 were $19.0 million and $0.26 per diluted share, respectively, compared to $14.6 million and $0.20 per diluted share in the same quarter of 2023.

  • FFO and FFO per diluted share for the third quarter of 2024 were $28.2 million and $0.39 per diluted share, respectively, compared to $21.2 million and $0.29 per diluted share in the same quarter of 2023.

    • CRE and Corporate-related FFO per diluted share for the third quarter of 2024 was $0.28 per diluted share compared to $0.25 per diluted share in the same quarter of 2023.
  • Adjusted FFO and Adjusted FFO per diluted share for the third quarter of 2024 were $23.4 million and $0.32 per diluted share, respectively, compared to $17.4 million and $0.24 per diluted share in the same quarter of 2023.

  • Selling, general and administrative expense decreased by $0.2 million, or 1.7%, to $7.4 million, from $7.6 million in the same quarter of 2023.

CRE Highlights for Q3 2024

  • CRE operating revenue for the third quarter of 2024 increased by $1.2 million, or 2.4%, to $49.4 million, from $48.2 million in the same quarter of 2023.

  • CRE operating profit for the third quarter of 2024 increased by $2.2 million, or 10.6%, to $22.8 million, from $20.6 million in the same quarter of 2023.

  • CRE NOI for the third quarter of 2024 increased by $1.4 million, or 4.4%, to $32.4 million, from $31.0 million in the same quarter of 2023.

  • CRE Same-Store NOI for the third quarter of 2024 increased by $1.3 million, or 4.1%, to $32.2 million, from $30.9 million in the same quarter of 2023.

    • Collections of prior year reserves in the third quarter of 2024 were $0.3 million compared to $0.5 million in the same quarter of 2023.
  • During the third quarter of 2024, the Company executed a total of 71 improved-property leases, covering approximately 182,100 square feet of gross leasable area ("GLA").

  • Comparable leasing spreads in our improved property portfolio were 15.3% for the third quarter of 2024, which included 18.2% for retail spaces and 9.9% for industrial spaces.

  • Leasing activity related to our improved property portfolio during the third quarter of 2024 included:
    • Six leases at Queens' Marketplace totaling approximately 30,000 square feet of GLA and $2.3 million of annualized base rent ("ABR").

    • 12 leases related to properties located in Kailua, including Aikahi Park Shopping Center, totaling approximately 26,000 square feet of GLA and $0.9 million of ABR.

    • Five leases at Waipio Shopping Center totaling approximately 16,000 square feet of GLA and $0.7 million of ABR.

    • One lease at Komohana Industrial Park totaling approximately 31,000 square feet of GLA and $0.5 million of ABR.
  • Overall leased occupancy was 94.0% as of September 30, 2024, an increase of 10 basis points compared to June 30, 2024, and a decrease of 60 basis points compared to September 30, 2023.

    • Leased occupancy in the retail portfolio was 92.9% as of September 30, 2024, an increase of 10 basis points compared to June 30, 2024, and a decrease of 110 basis points compared to September 30, 2023.

    • Leased occupancy in the industrial portfolio was 97.4% as of September 30, 2024, an increase of 30 basis points compared to June 30, 2024, and an increase of 60 basis points compared to September 30, 2023.
  • Same-Store leased occupancy was 94.8% as of September 30, 2024, flat compared to June 30, 2024, and a decrease of 80 basis points compared to September 30, 2023.

    • Same-Store leased occupancy in the retail portfolio was 94.1% as of September 30, 2024, an increase of 10 basis points compared to June 30, 2024, and a decrease of 130 basis points compared to September 30, 2023.

    • Same-Store leased occupancy in the industrial portfolio was 97.2% as of September 30, 2024, an increase of 20 basis points compared to June 30, 2024, and an increase of 50 basis points compared to September 30, 2023.

CRE Investment Activity for Q3 2024

  • On September 20, 2024, the Company closed on the off-market acquisition of an 81,500-square-foot distribution facility for $29.7 million. The facility is fully leased to Hansen Distribution Group, a broadline food service subsidiary of C&S Wholesale Grocers and was an opportunity to recycle capital from Waipouli Town Center which was sold in October 2024.

  • The permitting process continues for the 29,550-square-foot warehouse and distribution center at Maui Business Park II. The single-user space includes 32' clear height and can accommodate up to 14 dock-high loading bays. Construction of this pre-leased space will begin in early 2025, with an in-service date expected in late 2025.

Land Operations

  • Land Operations operating profit was $7.9 million for the quarter ended September 30, 2024, compared to an operating profit of $2.9 million for the quarter ended September 30, 2023. The increase in operating profit from the prior year quarter is due primarily to higher unimproved land and development lot sales, including an 81-acre parcel on Maui and one Maui Business Park lot, as well as higher legacy joint venture income in the third quarter of 2024 as compared to the same quarter in 2023.

Balance Sheet, Capital Markets Activities, and Liquidity

  • As of September 30, 2024, the Company had an equity market capitalization of $1.4 billion and $472.2 million in total debt, for a total market capitalization of approximately $1.9 billion. The Company's debt-to-total market capitalization was 25.3% as of September 30, 2024. The Company's debt has a weighted-average maturity of 2.9 years.

  • Including the effects of interest rate swaps, at quarter end, the Company had a weighted-average interest rate of 4.58% and 96.8% of the Company's debt was at fixed rates.

  • In the third quarter of 2024, the Company's previously established ATM equity offering program (the "2021 ATM") expired. On August 13, 2024, the Company established a new ATM (the "2024 ATM") to issue and sell common stock up to an aggregate offering price of $200.0 million. The Company did not sell any shares under the 2021 ATM or 2024 ATM in the current year.

  • As of September 30, 2024, the Company had total liquidity of $445.9 million, consisting of cash on hand of $17.9 million and $428.0 million available on its revolving line of credit.

  • Net Debt to Trailing Twelve Months ("TTM") Consolidated Adjusted EBITDA was 3.6 times as of September 30, 2024, with TTM Consolidated Adjusted EBITDA of $124.8 million for the period ended September 30, 2024.

  • Subsequent to quarter end, the Company amended its revolving credit facility, which extends the term of the facility to October 2028 with two six-month extension options and provides for $450.0 million of borrowing capacity. The interest rate under the amended revolving credit facility remains unchanged from the prior facility at a rate of SOFR plus 1.15%, based on a pricing grid and a SOFR adjustment.

  • The Company paid a third quarter 2024 dividend of $0.2225 per share on October 7, 2024.

  • Consistent with historical practice, the Company's Board plans to declare a fourth quarter 2024 dividend in December 2024, with payment in January 2025.

 

2024 Full-Year Guidance

The Company revised its 2024 Full-Year guidance as follows:





2024 Guidance


Q3 YTD


Revised


Prior

Net Income (Loss) available to A&B common
shareholders per diluted share

$0.66


$0.74 to $0.82


$0.64 to $0.73

FFO per diluted share

$1.07


$1.27 to $1.35


$1.17 to $1.26

Adjusted FFO per diluted share

$0.91


$1.05 to $1.12


$0.99 to $1.08

CRE Same-Store NOI growth %

3.0 %


1.75% to 2.75%


1.25% to 2.25%

CRE Same-Store NOI growth %,

excluding collections of prior year reserves

3.4 %


2.25% to 3.15%


2.10% to 3.10%



FFO per diluted share guidance is comprised of:




2024 Guidance


Q3 YTD


Revised


Prior

FFO per share related to CRE and Corporate

$0.85


$1.07 to $1.11


$1.04 to $1.08

FFO per share related to Land Operations

$0.22


$0.20 to $0.24


$0.13 to $0.18

FFO per diluted share

$1.07


$1.27 to $1.35


$1.17 to $1.26

 

ABOUT ALEXANDER & BALDWIN

Alexander & Baldwin, Inc. (NYSE: ALEX) (A&B) is the only publicly-traded real estate investment trust to focus exclusively on Hawai'i commercial real estate and is the state's largest owner of grocery-anchored, neighborhood shopping centers. A&B owns, operates and manages approximately four million square feet of commercial space in Hawai'i, including 21 retail centers, 14 industrial assets and four office properties, as well as 142 acres of ground lease assets. Over its 154-year history, A&B has evolved with the state's economy and played a leadership role in the development of the agricultural, transportation, tourism, construction, residential and commercial real estate industries.

Learn more about A&B at www.alexanderbaldwin.com.

Contact:

Jordan Hino

(808) 525-8475

investorrelations@abhi.com

 

ALEXANDER & BALDWIN, INC. AND SUBSIDIARIES
SEGMENT DATA & OTHER FINANCIAL INFORMATION
(amounts in thousands, except per share data; unaudited)








Three Months Ended September 30,


Nine Months Ended September 30,



2024


2023


2024


2023

Operating Revenue:









Commercial Real Estate


$            49,381


$            48,232


$         147,477


$         145,635

Land Operations


12,563


4,263


26,716


10,366

Total operating revenue


61,944


52,495


174,193


156,001

Operating Profit (Loss):









Commercial Real Estate


22,829


20,649


67,421


64,206

Land Operations


7,881


2,878


15,980


4,485

Total operating profit (loss)


30,710


23,527


83,401


68,691

Interest expense


(5,680)


(6,077)


(17,119)


(16,975)

Corporate and other expense


(5,651)


(5,445)


(14,833)


(19,410)

Income (Loss) from Continuing Operations Before Income Taxes


19,379


12,005


51,449


32,306

Income tax benefit (expense)


(75)



(174)


(7)

Income (Loss) from Continuing Operations


19,304


12,005


51,275


32,299

Income (loss) from discontinued operations, net of income taxes


(300)


3,894


(3,181)


3,902

Net Income (Loss)


19,004


15,899


48,094


36,201

Loss (income) attributable to discontinued noncontrolling interest



(1,250)



(2,883)

Net Income (Loss) Attributable to A&B Shareholders


$            19,004


$            14,649


$           48,094


$           33,318










Basic Earnings (Loss) Per Share of Common Stock:









Continuing operations available to A&B shareholders


$                0.27


$                0.16


$               0.71


$               0.44

Discontinued operations available to A&B shareholders


(0.01)


0.04


(0.05)


0.02

Net income (loss) available to A&B shareholders


$                0.26


$                0.20


$               0.66


$               0.46










Diluted Earnings (Loss) Per Share of Common Stock:









Continuing operations available to A&B shareholders


$                0.27


$                0.16


$               0.70


$               0.44

Discontinued operations available to A&B shareholders


(0.01)


0.04


(0.04)


0.02

Net income (loss) available to A&B shareholders


$                0.26


$                0.20


$               0.66


$               0.46










Weighted-Average Number of Shares Outstanding:









Basic


72,630


72,623


72,597


72,597

Diluted


72,817


72,844


72,718


72,800










Amounts Available to A&B Common Shareholders:









Continuing operations available to A&B common shareholders


$            19,298


$            11,984


$           51,257


$           32,217

Discontinued operations available to A&B common shareholders


(300)


2,644


(3,181)


1,019

Net income (loss) available to A&B common shareholders


$            18,998


$            14,628


$           48,076


$           33,236










 

ALEXANDER & BALDWIN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands; unaudited)








September 30,


December 31,



2024


2023

ASSETS





Real estate investments





Real estate property


$          1,644,293


$          1,609,013

Accumulated depreciation


(249,281)


(227,282)

Real estate property, net


1,395,012


1,381,731

Real estate developments


54,696


58,110

Investments in real estate joint ventures and partnerships


5,907


6,850

Real estate intangible assets, net


32,564


36,298

Real estate investments, net


1,488,179


1,482,989

Cash and cash equivalents


17,919


13,517

Restricted cash


236


236

Accounts receivable, net


3,501


4,533

Goodwill


8,729


8,729

Other receivables, net


12,607


23,601

Prepaid expenses and other assets


104,795


98,652

Assets held for sale


14,036


13,984

Total assets


$          1,650,002


$          1,646,241






LIABILITIES AND EQUITY





Liabilities:





Notes payable and other debt


$             472,179


$             463,964

Accounts payable


4,910


5,845

Accrued post-retirement benefits


8,173


9,972

Deferred revenue


72,499


70,353

Accrued and other liabilities


94,059


93,096






Equity


998,182


1,003,011

Total liabilities and equity


$          1,650,002


$          1,646,241

 

ALEXANDER & BALDWIN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED CASH FLOWS
(amounts in thousands; unaudited)




Nine Months Ended September 30,



2024


2023

Cash Flows from Operating Activities:





Net income (loss)


$               48,094


$               36,201

Adjustments to reconcile net income (loss) to net cash provided by (used in) operations:





Loss (income) from discontinued operations


3,181


(3,902)

Depreciation and amortization


26,979


27,572

Provision for credit losses


(628)


Loss (gain) from disposals, net


(2,148)


(1,117)

Impairment of assets



649

Loss (gain) on de-designated interest rate swap valuation adjustment


(3,675)


Share-based compensation expense


3,654


5,283

Loss (income) related to joint ventures, net of operating cash distributions


(3,062)


(1,851)

Changes in operating assets and liabilities:





Trade and other receivables


(611)


(92)

Prepaid expenses and other assets


(3,649)


(3,531)

Development/other property inventory


8,018


(1,518)

Accrued post-retirement benefits


(1,798)


(10)

Accounts payable


(1,188)


258

Accrued and other liabilities


2,225


(2,179)

Operating cash flows from continuing operations


75,392


55,763

Operating cash flows from discontinued operations


(1,718)


(12,150)

Net cash provided by (used in) operations


73,674


43,613






Cash Flows from Investing Activities:





Capital expenditures for acquisitions


(29,826)


(9,464)

Capital expenditures for property, plant and equipment


(11,878)


(13,595)

Proceeds from disposal of assets


41


3,294

Payments for purchases of investments in affiliates and other investments


(158)


(236)

Distributions of capital and other receipts from investments in affiliates and other investments


974


1

Investing cash flows from continuing operations


(40,847)


(20,000)

Investing cash flows from discontinued operations


15,000


647

Net cash provided by (used in) investing activities


(25,847)


(19,353)






Cash Flows from Financing Activities:





Proceeds from issuance of notes payable and other debt


60,000


Payments of notes payable and other debt and deferred financing costs


(86,785)


(33,674)

Borrowings (payments) on line-of-credit agreement, net


35,000


69,000

Cash dividends paid


(48,822)


(64,249)

Repurchases of common stock and other payments


(2,818)


(3,576)

Financing cash flows from continuing operations


(43,425)


(32,499)

Financing cash flows from discontinued operations



(10,721)

Net cash provided by (used in) financing activities


(43,425)


(43,220)






Cash, Cash Equivalents, Restricted Cash, and Cash included in Assets Held for Sale





Net increase (decrease) in cash, cash equivalents, restricted cash, and cash included in assets
held for sale


4,402


(18,960)

Balance, beginning of period


13,753


34,409

Balance, end of period


$               18,155


$               15,449

 

USE OF NON-GAAP FINANCIAL MEASURES

The Company uses non-GAAP measures when evaluating operating performance because management believes that they provide additional insight into the Company's and segments' core operating results, and/or the underlying business trends affecting performance on a consistent and comparable basis from period to period. These measures generally are provided to investors as an additional means of evaluating the performance of ongoing core operations. The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for or superior to, financial measures calculated in accordance with GAAP.

NOI and Same-Store NOI

NOI is a non-GAAP measure used internally in evaluating the unlevered performance of the Company's Commercial Real Estate portfolio. Management believes NOI provides useful information to investors regarding the Company's financial condition and results of operations because it reflects only the contract-based income and cash-based expense items that are incurred at the property level. When compared across periods, NOI can be used to determine trends in earnings of the Company's properties as this measure is not affected by non-contract-based revenue (e.g., straight-line lease adjustments required under GAAP); by non-cash expense recognition items (e.g., the impact of depreciation and amortization expense or impairments); or by other income, expenses, gains, or losses that do not directly relate to the Company's ownership and operations of the properties (e.g., indirect selling, general, administrative and other expenses, as well as lease termination income). Management believes the exclusion of these items from operating profit (loss) is useful because the resulting measure captures the contract-based revenue that is realizable (i.e., assuming collectability is deemed probable) and the direct property-related expenses paid or payable in cash that are incurred in operating the Company's Commercial Real Estate portfolio, as well as trends in occupancy rates, rental rates and operating costs. NOI should not be viewed as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

The Company reports NOI and Occupancy on a Same-Store basis, which includes the results of properties that were owned, operated, and stabilized for the entirety of the prior calendar year and current reporting period, year-to-date. Management believes that reporting on a Same-Store basis provides investors with additional information regarding the operating performance of comparable assets separate from other factors (such as the effect of developments, redevelopments, acquisitions or dispositions).

Reconciliations of CRE operating profit to CRE NOI, Same-Store NOI and Same-Store NOI Excluding Collections of Amounts Reserved in Previous Years are as follows:



Three Months Ended September 30,



(amounts in thousands; unaudited)


2024


2023


Change

CRE Operating Profit


$                22,829


$                20,649


$                 2,180

Depreciation and amortization


8,932


9,166


(234)

Straight-line lease adjustments


(564)


(849)


285

Favorable/(unfavorable) lease amortization


(103)


(334)


231

Termination fees and other


8


(132)


140

Interest and other income (expense), net


(26)


159


(185)

Impairment losses



649


(649)

Selling, general, administrative


1,292


1,703


(411)

NOI


32,368


31,011


1,357

Less: NOI from acquisitions, dispositions, and other adjustments


(212)


(132)


(80)

Same-Store NOI


32,156


30,879


1,277

Less: Collections of amounts reserved in previous years


(310)


(460)


150

Same-Store NOI excluding collections of amounts reserved in prior years


$                31,846


$                30,419


$                 1,427

 

The forward looking guidance included in this release includes certain forward-looking information, including CRE Same-Store NOI growth % and CRE Same-Store NOI growth %, excluding collections of prior year reserves, that is not presented in accordance with GAAP. In reliance on the exception in Item 10(e)(1)(i)(B) of Regulation S-K, we do not provide a quantitative reconciliation of such forward-looking CRE Same-Store NOI growth % amounts to the most directly comparable GAAP financial measure. These forward-looking same-store calculations include only activity from properties owned for comparable periods. We are unable, without unreasonable effort, to provide a meaningful or reasonably accurate calculation or estimation of certain reconciling items, including but not limited to, (i) occupancy changes; (ii) terms for new and renewal leases; (iii) collections from tenants; and (iv) other nonrecurring/unplanned income or expense items. These items are inherently uncertain and depend on various factors, many of which are beyond our control, and the unavailable components could have a significant impact on our future financial results.

Funds From Operations and Adjusted Funds From Operations

Management believes that FFO serves as a supplemental measure to net income calculated in accordance with GAAP for comparing its performance and operations to those of other REITs because it excludes items included in net income that do not relate to or are not indicative of the Company's operating and financial performance, such as depreciation and amortization related to real estate, which assumes that the value of real estate assets diminishes predictably over time instead of fluctuating with market conditions, and items that can make periodic or peer analysis more difficult, such as gains and losses from the sale of CRE properties, impairment losses related to CRE properties, and income (loss) from discontinued operations. Management believes that FFO more accurately provides an investor an indication of our ability to incur and service debt, make capital expenditures and fund other needs.

The Company has been executing a simplification strategy to focus on the growth and expansion of its commercial real estate portfolio in Hawai'i by monetizing its legacy assets and operations. The sale of Grace Pacific, LLC and the Company-owned quarry land on Maui in 2023 marked the culmination of the Company's simplification strategy. Although the Company has some remaining legacy assets to be monetized, investors and analysts now view the Company as a pure-play REIT. In order to enhance comparability to other REITs, the Company provides an additional performance metric, Adjusted FFO, to further adjust FFO to exclude the effects of certain items not related to ongoing property operations. Adjusted FFO is a widely recognized measure of the property operations of REITs and may be more useful than FFO in evaluating the operating performance of the Company's properties over the long term, as well as enabling investors and analysts to assess performance in comparison to other real estate companies.

FFO and Adjusted FFO do not represent alternatives to net income calculated in accordance with GAAP and should not be viewed as more prominent measures of performance than net income (loss) or cash flows from operations prepared in accordance with GAAP. In addition, FFO and Adjusted FFO do not represent and should not be considered alternatives to cash generated from operating activities determined in accordance with GAAP, nor should they be used as measures of the Company's liquidity, or cash available to fund the Company's needs or pay distributions. FFO and Adjusted FFO should be considered only as supplements to net income as a measure of the Company's performance.

The Company presents both non-GAAP measures and reconciles FFO to the most directly-comparable GAAP measure, Net Income (Loss) available to A&B common shareholders, and FFO to Adjusted FFO. The Company's FFO and Adjusted FFO may not be comparable to such metrics reported by other REITs due to possible differences in the interpretation of the current Nareit definition used by such REITs.

Reconciliations of net income (loss) available to A&B common shareholders to FFO and Adjusted FFO are as follows:



Three Months Ended September 30,

(amounts in thousands; unaudited)


2024


2023

Net Income (Loss) available to A&B common shareholders


$              18,998


$              14,628

Depreciation and amortization of commercial real estate properties


8,932


9,166

(Income) loss from discontinued operations, net of income taxes


300


(3,894)

Income (loss) attributable to discontinued noncontrolling interest



1,250

FFO


28,230


$              21,150

Add (deduct) Adjusted FFO defined adjustments





Impairment losses - abandoned development costs


$                      —


$                   649

Non-cash changes to liabilities related to legacy operations1



200

Provision for current expected credit losses


(628)


Legacy joint venture (income)/loss2


(2,142)


(950)

Amortization of share-based compensation


1,266


1,023

Maintenance capital expenditures3


(2,503)


(3,463)

Leasing commissions paid


(389)


(293)

Straight-line lease adjustments


(564)


(849)

Amortization of net debt premiums or discounts and deferred financing costs


247


243

Amortization of above and below-market leases, net


(103)


(280)

Adjusted FFO


$              23,414


$              17,430






1 Primarily related to environmental reserves associated with legacy business activities in the Land Operations segment.

2 Includes joint ventures engaged in legacy business activities within the Land Operations segment.

3 Includes ongoing maintenance capital expenditures only.

 

Reconciliations of net income (loss) available to A&B common shareholders per diluted share, to both the forward-looking range of FFO per diluted share and the forward-looking range of Adjusted FFO per diluted share, are as follows:

Reconciliations of Net Income available to A&B common shareholders to FFO and Adjusted FFO














Nine Months Ended 
September 30, 2024


Full-Year 2024 Estimate - Revised1


Full-Year 2024 Estimate - Prior1




Low


High
















Net Income (Loss) available to A&B common shareholders per diluted share


$                  0.66


$         0.74


$           0.82


$     0.64


$      0.73

Depreciation and amortization of commercial real estate properties


0.37


0.49


0.49


0.49


0.49

(Income) loss from discontinued operations, net of income taxes


0.04


0.04


0.04


0.04


0.04

FFO per diluted share


$                  1.07


$          1.27


$           1.35


$      1.17


$      1.26

Add (deduct) Adjusted FFO defined adjustments











Amortization of share-based compensation


0.05


0.06


0.06


0.07


0.07

Maintenance capital expenditures


(0.11)


(0.18)


(0.16)


(0.17)


(0.15)

Legacy joint venture (income)/loss


(0.05)


(0.05)


(0.07)


(0.02)


(0.03)

Leasing commissions paid


(0.01)


(0.02)


(0.02)


(0.02)


(0.02)

Straight-line lease adjustments


(0.03)


(0.03)


(0.04)


(0.03)


(0.04)

Amortization of net debt premiums or discounts and deferred financing costs


0.01


0.02


0.02


0.02


0.02

Other2


(0.02)


(0.02)


(0.02)


(0.03)


(0.03)

Adjusted FFO per diluted share


$                  0.91


$          1.05


$           1.12


$      0.99


$      1.08












FFO per share related to CRE and Corporate


$                  0.85


$          1.06


$            1.11


$      1.04


$      1.08

FFO per diluted share related to Land Operations3


0.22


0.20


0.24


0.13


0.18

FFO per diluted share


$                  1.07


$          1.27


$            1.35


$      1.17


$      1.26












1 The full-year 2024 estimate reflects guidance as of the date of this earnings release and assumes that diluted shares equal the latest year-to-date ending
amount.

2 Other adjustments in the Adjusted FFO reconciliation include non-recurring and other items that are not forecasted for guidance purposes such as, but not
limited to, gains or losses related to the sale of legacy businesses, non-cash changes to liabilities related to legacy operations, fair value adjustments related to
interest rate swaps, provision for current expected credit losses, and non-recurring financing charges. Actual results are included in the full-year estimate once
recorded.

3 FFO per diluted share related to Land Operations is equal to Land Operations operating profit (loss) divided by diluted shares, as there are no reconciling
items between Land Operations operating profit (loss) and FFO for the Land Operations segment.

Net Debt

Net Debt is calculated by adjusting the Company's total debt to its notional amount (by excluding unamortized premium, discount and capitalized loan fees) and by subtracting cash and cash equivalents recorded in the Company's consolidated balance sheets.

A reconciliation of the Company's Net Debt is as follows.



September 30,


December 31,

(amounts in thousands; unaudited)


2024


2023

Debt





Secured debt


$         128,572


$         189,713

Unsecured term debt


271,607


237,251

Unsecured revolving credit facility


72,000


37,000

Total debt


472,179


463,964

Net unamortized deferred financing cost / discount (premium)


329


149

Cash and cash equivalents


(17,919)


(13,517)

Net debt


$         454,589


$         450,596

EBITDA and Adjusted EBITDA

The Company may report various forms of EBITDA (e.g. Consolidated EBITDA, Consolidated Adjusted EBITDA, and Land Operations EBITDA) as non-GAAP measures used by the Company in evaluating the segments' and Company's operating performance on a consistent and comparable basis from period to period. The Company provides this information to investors as an additional means of evaluating the performance of the segments' and Company's ongoing operations.

The Company also adjusts Consolidated EBITDA to arrive at Consolidated Adjusted EBITDA for items identified as non-recurring, infrequent or unusual that are not expected to recur in the segment's normal operations (or in the Company's core business).

As an illustrative example, the Company identified non-cash impairment as non-recurring, infrequent or unusual items that are not expected to recur in the consolidated or segment's normal operations. By excluding these items from Consolidated EBITDA to arrive at Consolidated Adjusted EBITDA, the Company believes it provides meaningful supplemental information about its operating performance and facilitates comparisons to historical operating results. Such non-GAAP measures should not be viewed as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Reconciliations of the Company's consolidated net income to Consolidated EBITDA and Consolidated Adjusted EBITDA are as follows:



TTM September 30,


TTM December 31,

(amounts in thousands, unaudited)


2024


2023

Net Income (Loss)


$                 44,856


$                      32,963

Adjustments:





Depreciation and amortization


36,198


36,791

Interest expense


23,107


22,963

Income tax expense (benefit)


202


35

Interest expense related to discontinued operations


12


496

Consolidated EBITDA


104,375


93,248

Asset impairments


4,119


4,768

(Gain)/loss on fair value adjustments related to interest rate swaps


(957)


2,718

Non-recurring financing charges


2,350


(Income) loss from discontinued operations, net of income taxes and excluding depreciation, amortization and interest expense


14,918


7,351

Consolidated Adjusted EBITDA


$               124,805


$                    108,085

FORWARD-LOOKING STATEMENTS

Statements in this release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding possible or assumed future results of operations, business strategies, growth opportunities and competitive positions. Such forward-looking statements speak only as of the date the statements were made and are not guarantees of future performance. Forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from those expressed in or implied by the forward-looking statements. These factors include, but are not limited to, prevailing market conditions and other factors related to the Company's REIT status and the Company's business, the evaluation of alternatives by the Company related to its non-core assets, and the risk factors discussed in the Company's most recent Form 10-K, Form 10-Q and other filings with the Securities and Exchange Commission. The information in this release should be evaluated in light of these important risk factors. We do not undertake any obligation to update the Company's forward-looking statements.

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/alexander--baldwin-inc-reports-third-quarter-2024-results-302286502.html

SOURCE Alexander & Baldwin

FAQ

What was Alexander & Baldwin's (ALEX) earnings per share in Q3 2024?

Alexander & Baldwin reported earnings of $0.26 per diluted share in Q3 2024.

What was ALEX's FFO per share in Q3 2024?

ALEX reported FFO of $0.39 per diluted share in Q3 2024.

What was Alexander & Baldwin's (ALEX) occupancy rate in Q3 2024?

ALEX reported an overall leased occupancy rate of 94.0% as of September 30, 2024.

What is Alexander & Baldwin's (ALEX) revised FFO guidance for 2024?

ALEX revised its FFO guidance to $1.27-$1.35 per diluted share for full-year 2024.

Alexander & Baldwin, Inc.

NYSE:ALEX

ALEX Rankings

ALEX Latest News

ALEX Stock Data

1.35B
72.63M
1.38%
88.98%
0.77%
REIT - Retail
Real Estate Investment Trusts
Link
United States of America
HONOLULU