BXP Announces 2nd Quarter 2022 Results; Reports Q2 EPS of $1.42 and FFO Per Share of $1.94
Boston Properties, Inc. (BXP) reported a strong Q2 2022 performance, with revenue rising over 8% to $773.9 million, net income of $223.0 million ($1.42 EPS), and FFO of $304.6 million ($1.94 per share). Both EPS and FFO surpassed guidance midpoints. Approximately 1.9 million square feet of leases were executed, and BXP expanded its Seattle presence with the $730 million acquisition of Madison Centre. The company raised its full-year 2022 guidance for EPS to $5.40 - $5.45 and FFO to $7.48 - $7.53, amid strong leasing activity and ongoing development projects.
- Revenue increased by over 8% to $773.9 million.
- Net income rose to $223.0 million, a significant increase from the previous year.
- FFO improved to $304.6 million, exceeding guidance.
- Executed 1.9 million square feet of leases during the quarter.
- Acquired Madison Centre in Seattle for $730 million, enhancing portfolio quality.
- Increased full-year guidance for EPS to $5.40 - $5.45 and FFO to $7.48 - $7.53.
- Some lease agreements are subject to conditions outside BXP's control.
- Portfolio outperformance partially driven by deferred maintenance expenses.
Exceeded Q2 2022 Guidance for EPS and FFO; Increased Full Year 2022 Guidance for EPS and FFO; Executed 1.9 Million SF of Leases in Q2; and Expanded Presence in the Seattle Market
Financial highlights for the second quarter include:
-
Revenue grew more than
8% to for the quarter ended$773.9 million June 30, 2022 , as compared to for the quarter ended$713.8 million June 30, 2021 . -
Net income attributable to common shareholders of
, or$223.0 million per diluted share (EPS) for the quarter ended$1.42 June 30, 2022 , compared to , or$111.7 million per diluted share, for the quarter ended$0.71 June 30, 2021 . -
Funds from Operations (FFO) of
, or$304.6 million per diluted share for the quarter ended$1.94 June 30, 2022 , compared to FFO of , or$268.6 million per diluted share, for the quarter ended$1.72 June 30, 2021 . -
EPS and FFO per share exceeded the mid-points of BXP’s guidance by
and$0.62 per share, respectively. EPS included a gain on sale of$0.09 per share, and each of EPS and FFO included$0.55 per share of better-than-projected portfolio performance. The portfolio outperformance was partially due to lower-than-projected operating expenses of$0.09 per share resulting from the deferral of certain maintenance expenses. We expect to recognize a majority of those Q2 expense savings in the second half of 2022.$0.05
BXP provided guidance for (1) third quarter 2022 EPS of
Second quarter and recent business highlights include:
-
Executed approximately 1.9 million square feet of leases, the strongest leasing quarter since Q3 2019 and approximately
140% of our historical 10-year average for the quarter. Notable leases include:-
A 570,000 square foot lease for the first phase of a future life sciences development at
290 Binney Street inCambridge, MA. The lease and the commencement of development are subject to various conditions, some of which are not within BXP’s control -
A 125,000 square foot lease at
767 Fifth Avenue (The GM Building ) inNew York City ,New York -
A 112,000 square foot lease with a life sciences client at 180 CityPoint in
Waltham, Massachusetts -
A 104,000 square foot lease at
140 Kendrick Street inNeedham, Massachusetts
-
A 570,000 square foot lease for the first phase of a future life sciences development at
-
Completed the acquisition of Madison Centre in
Seattle, Washington , for a gross purchase price of approximately . Madison Centre is an approximately 755,000 square foot, 37-story, LEED-Platinum certified, Class A office property. Madison Centre was constructed in 2017, is approximately$730.0 million 93% leased, and is considered one of the highest quality buildings inSeattle . The acquisition was completed with a unsecured term loan that matures on$730.0 million May 16, 2023 . As ofJune 30, 2022 , the term loan bears interest at a variable rate equal to Term SOFR plus0.95% per annum. -
Commenced two development projects within
Reston Town Center inReston, Virginia :-
A residential property that is expected to consist of 508 units across a five-story low-rise building and an iconic 39-story tower, which will be one of the tallest buildings in
Northern Virginia . The fifth floor of the tower will serve as a full-floor amenity level with a large co-working space, fitness center, sports bar/game area, communal kitchen, and numerous seating areas. A pool and a collection of fire pit areas will sit above a structured garage. The property is owned by a newly formed joint venture with an institutional partner in which BXP has a20% interest. The joint venture obtained a construction loan that bears interest at a variable rate equal to SOFR plus$140.0 million 2.00% per annum and matures onMay 13, 2026 , with two, one-year extension options, subject to certain conditions. - Adjacent to the residential property, a Class A office and retail project that, when completed, will consist of approximately 90,000 square feet of boutique commercial space with highly efficient floor plates. Premium amenities will include a large rooftop terrace and indoor amenity space with a catering kitchen.
-
A residential property that is expected to consist of 508 units across a five-story low-rise building and an iconic 39-story tower, which will be one of the tallest buildings in
-
In
June 2022 , completed and fully placed in-service325 Main Street , a Class A office building with approximately 414,000 square feet of office and retail space located inCambridge, Massachusetts . The office component, comprising approximately 380,000 square feet, is100% leased. -
In
June 2022 , completed the sale of a portfolio of eleven suburban office properties aggregating approximately 733,000 net rentable square feet, located inSpringfield, Virginia , for an aggregate gross sales price of . Net cash proceeds totaled approximately$127.0 million , and BXP recognized a gain on sale of real estate totaling approximately$121.9 million .$96.2 million -
In
June 2022 , refinanced the mortgage loan collateralized by Hub50House located inBoston, Massachusetts . The new mortgage loan has a principal balance of , bears interest at a variable rate equal to SOFR plus$185.0 million 1.35% per annum and matures onJune 17, 2032 . The property is owned by a joint venture in which BXP has a50% interest. At closing, the joint venture entered into interest rate swap contracts with notional amounts aggregating effective through$185.0 million April 10, 2032 , resulting in a fixed rate of approximately4.432% per annum through the expiration of the interest rate swap contracts. The previous construction loan had an outstanding balance of approximately and matured in$176.7 million June 2022 . -
Continued leadership and ongoing commitment to ESG and sustainability performance:
-
In
April 2022 , released BXP’s 2021 ESG Report, which highlights that BXP remains on track to achieve carbon-neutral operations by 2025. Following the report’s release, BXP hosted its first ESG Investor Webcast inJune 2022 . -
In
May 2022 , received the 2022 ENERGY STAR® Partner of the Year - Sustained Excellence Award from theU.S. Environmental Protection Agency and theU.S. Department of Energy for the second consecutive year. -
In
May 2022 , BXP’s ESG rating was upgraded from ‘A’ to ‘AA’ byMSCI ESG Research . MSCI is a leading provider of in-depth research, ratings and analysis of environmental, social and governance-related business activities for the global investment community.
-
In
-
In
June 2022 , celebrated the 25th Anniversary of BXP’s listing on theNew York Stock Exchange . Representatives from BXP across theU.S. rang the closing bell onJune 24th in recognition of this milestone.
The reported results are unaudited and there can be no assurance that these reported results will not vary from the final information for the quarter ended
EPS and FFO per Share Guidance:
BXP’s guidance for the third quarter and full year 2022 for EPS (diluted) and FFO per share (diluted) is set forth and reconciled below. Except as described below, the estimates reflect management’s view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels, the timing of the lease-up of available space, and the earnings impact of the events referenced in this release and those referenced during the related conference call. Except as otherwise publicly disclosed, the estimates do not include the impacts of any potential (1) capital markets activity, (2) future write-offs or reinstatements of accounts receivable and accrued rent balances, or (3) future impairment charges. EPS estimates may be subject to fluctuations as a result of several factors, including changes in the recognition of depreciation and amortization expense, impairment losses on depreciable real estate, and any gains or losses associated with disposition activity. BXP is not able to assess at this time the potential impact of these factors on projected EPS. By definition, FFO does not include real estate-related depreciation and amortization, impairment losses on depreciable real estate, or gains or losses associated with disposition activities. There can be no assurance that BXP’s actual results will not differ materially from the estimates set forth below.
|
|
Third Quarter 2022 |
|
Full Year 2022 |
||||||||||
|
|
Low |
|
High |
|
Low |
|
High |
||||||
Projected EPS (diluted) |
|
$ |
0.74 |
|
$ |
0.76 |
|
$ |
5.40 |
|
|
$ |
5.45 |
|
Add: |
|
|
|
|
|
|
|
|
||||||
|
|
|
1.12 |
|
|
1.12 |
|
|
4.37 |
|
|
|
4.37 |
|
|
|
|
— |
|
|
— |
|
|
(2.29 |
) |
|
|
(2.29 |
) |
Projected FFO per share (diluted) |
|
$ |
1.86 |
|
$ |
1.88 |
|
$ |
7.48 |
|
|
$ |
7.53 |
|
BXP will host a conference call on
Additionally, a copy of BXP’s second quarter 2022 “Supplemental Operating and Financial Data” and this press release are available in the Investors section of BXP’s website at investors.bxp.com.
This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. You can identify these statements by our use of the words “anticipates,” “believes,” “budgeted,” “could,” “estimates,” “expects,” “guidance,” “intends,” “may,” “might,” “plans,” “projects,” “should,” “will,” and similar expressions that do not relate to historical matters. These statements are based on our current plans, expectations, projections and assumptions about future events. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond BXP’s control. If our underlying assumptions prove inaccurate, or known or unknown risks or uncertainties materialize, actual results could differ materially from those expressed or implied by the forward-looking statement. These factors include, without limitation, the risks and uncertainties related to the impact of the COVID-19 global pandemic, including the emergence of additional variants, the effectiveness, availability and distribution of vaccines, including their efficacy against new variant strains and the willingness of individuals to be vaccinated, the impact of geopolitical conflicts, including the ongoing war in
Financial tables follow.
|
|||||||
CONSOLIDATED BALANCE SHEETS |
|||||||
(Unaudited) |
|||||||
|
|
|
|
||||
|
(in thousands, except for share
|
||||||
ASSETS |
|
|
|
||||
Real estate, at cost |
$ |
23,522,913 |
|
|
$ |
22,298,103 |
|
Construction in progress |
|
593,958 |
|
|
|
894,172 |
|
Land held for future development |
|
583,700 |
|
|
|
560,355 |
|
Right of use assets - finance leases |
|
237,488 |
|
|
|
237,507 |
|
Right of use assets - operating leases |
|
168,370 |
|
|
|
169,778 |
|
Less: accumulated depreciation |
|
(6,077,270 |
) |
|
|
(5,883,961 |
) |
Total real estate |
|
19,029,159 |
|
|
|
18,275,954 |
|
Cash and cash equivalents |
|
456,491 |
|
|
|
452,692 |
|
Cash held in escrows |
|
46,359 |
|
|
|
48,466 |
|
Investments in securities |
|
31,457 |
|
|
|
43,632 |
|
Tenant and other receivables, net |
|
64,607 |
|
|
|
70,186 |
|
Related party note receivable, net |
|
78,576 |
|
|
|
78,336 |
|
Note receivables, net |
|
— |
|
|
|
9,641 |
|
Accrued rental income, net |
|
1,265,480 |
|
|
|
1,226,745 |
|
Deferred charges, net |
|
684,078 |
|
|
|
618,798 |
|
Prepaid expenses and other assets |
|
55,232 |
|
|
|
57,811 |
|
Investments in unconsolidated joint ventures |
|
1,554,994 |
|
|
|
1,482,997 |
|
Total assets |
$ |
23,266,433 |
|
|
$ |
22,365,258 |
|
LIABILITIES AND EQUITY |
|
|
|
||||
Liabilities: |
|
|
|
||||
Mortgage notes payable, net |
$ |
3,269,948 |
|
|
$ |
3,267,914 |
|
Unsecured senior notes, net |
|
9,489,030 |
|
|
|
9,483,695 |
|
Unsecured line of credit |
|
165,000 |
|
|
|
145,000 |
|
Unsecured term loan, net |
|
728,795 |
|
|
|
— |
|
Lease liabilities - finance leases |
|
246,832 |
|
|
|
244,421 |
|
Lease liabilities - operating leases |
|
204,643 |
|
|
|
204,561 |
|
Accounts payable and accrued expenses |
|
342,467 |
|
|
|
320,775 |
|
Dividends and distributions payable |
|
170,937 |
|
|
|
169,859 |
|
Accrued interest payable |
|
96,821 |
|
|
|
94,796 |
|
Other liabilities |
|
401,360 |
|
|
|
391,441 |
|
Total liabilities |
|
15,115,833 |
|
|
|
14,322,462 |
|
|
|
|
|
||||
Commitments and contingencies |
|
— |
|
|
|
— |
|
Redeemable deferred stock units |
|
7,931 |
|
|
|
9,568 |
|
Equity: |
|
|
|
||||
Stockholders’ equity attributable to |
|
|
|
||||
Excess stock, |
|
— |
|
|
|
— |
|
Preferred stock, |
|
— |
|
|
|
— |
|
Common stock, |
|
1,567 |
|
|
|
1,565 |
|
Additional paid-in capital |
|
6,524,997 |
|
|
|
6,497,730 |
|
Dividends in excess of earnings |
|
(567,016 |
) |
|
|
(625,891 |
) |
|
|
(2,722 |
) |
|
|
(2,722 |
) |
Accumulated other comprehensive loss |
|
(27,077 |
) |
|
|
(36,662 |
) |
Total stockholders’ equity attributable to |
|
5,929,749 |
|
|
|
5,834,020 |
|
Noncontrolling interests: |
|
|
|
||||
Common units of the |
|
660,214 |
|
|
|
642,655 |
|
Property partnerships |
|
1,552,706 |
|
|
|
1,556,553 |
|
Total equity |
|
8,142,669 |
|
|
|
8,033,228 |
|
Total liabilities and equity |
$ |
23,266,433 |
|
|
$ |
22,365,258 |
|
|
||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three months ended
|
|
Six months ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
|
|
(in thousands, except for per share amounts) |
||||||||||||||
Revenue |
|
|
|
|
|
|
|
|
||||||||
Lease |
|
$ |
721,899 |
|
|
$ |
684,025 |
|
|
$ |
1,440,019 |
|
|
$ |
1,369,842 |
|
Parking and other |
|
|
30,346 |
|
|
|
18,282 |
|
|
|
52,080 |
|
|
|
35,220 |
|
Hotel revenue |
|
|
12,089 |
|
|
|
1,561 |
|
|
|
16,646 |
|
|
|
2,193 |
|
Development and management services |
|
|
6,354 |
|
|
|
7,284 |
|
|
|
12,185 |
|
|
|
14,087 |
|
Direct reimbursements of payroll and related costs from management services contracts |
|
|
3,239 |
|
|
|
2,655 |
|
|
|
7,304 |
|
|
|
6,160 |
|
Total revenue |
|
|
773,927 |
|
|
|
713,807 |
|
|
|
1,528,234 |
|
|
|
1,427,502 |
|
Expenses |
|
|
|
|
|
|
|
|
||||||||
Operating |
|
|
|
|
|
|
|
|
||||||||
Rental |
|
|
273,848 |
|
|
|
248,703 |
|
|
|
544,103 |
|
|
|
506,092 |
|
Hotel |
|
|
6,444 |
|
|
|
1,996 |
|
|
|
11,284 |
|
|
|
4,047 |
|
General and administrative |
|
|
34,665 |
|
|
|
38,405 |
|
|
|
77,859 |
|
|
|
83,364 |
|
Payroll and related costs from management services contracts |
|
|
3,239 |
|
|
|
2,655 |
|
|
|
7,304 |
|
|
|
6,160 |
|
Transaction costs |
|
|
496 |
|
|
|
751 |
|
|
|
496 |
|
|
|
1,082 |
|
Depreciation and amortization |
|
|
183,146 |
|
|
|
183,838 |
|
|
|
360,770 |
|
|
|
360,403 |
|
Total expenses |
|
|
501,838 |
|
|
|
476,348 |
|
|
|
1,001,816 |
|
|
|
961,148 |
|
Other income (expense) |
|
|
|
|
|
|
|
|
||||||||
Income (loss) from unconsolidated joint ventures |
|
|
(54 |
) |
|
|
(1,373 |
) |
|
|
2,135 |
|
|
|
3,852 |
|
Gains on sales of real estate |
|
|
96,247 |
|
|
|
7,756 |
|
|
|
118,948 |
|
|
|
7,756 |
|
Interest and other income (loss) |
|
|
1,195 |
|
|
|
1,452 |
|
|
|
2,423 |
|
|
|
2,620 |
|
Other income - assignment fee |
|
|
6,624 |
|
|
|
— |
|
|
|
6,624 |
|
|
|
— |
|
Gains (losses) from investments in securities |
|
|
(4,716 |
) |
|
|
2,275 |
|
|
|
(6,978 |
) |
|
|
3,934 |
|
Losses from early extinguishment of debt |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(898 |
) |
Interest expense |
|
|
(104,142 |
) |
|
|
(106,319 |
) |
|
|
(205,370 |
) |
|
|
(214,221 |
) |
Net income |
|
|
267,243 |
|
|
|
141,250 |
|
|
|
444,200 |
|
|
|
269,397 |
|
Net income attributable to noncontrolling interests |
|
|
|
|
|
|
|
|
||||||||
Noncontrolling interests in property partnerships |
|
|
(18,546 |
) |
|
|
(17,164 |
) |
|
|
(36,095 |
) |
|
|
(33,631 |
) |
Noncontrolling interest—common units of the |
|
|
(25,708 |
) |
|
|
(12,383 |
) |
|
|
(42,061 |
) |
|
|
(23,422 |
) |
Net income attributable to |
|
|
222,989 |
|
|
|
111,703 |
|
|
|
366,044 |
|
|
|
212,344 |
|
Preferred dividends |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2,560 |
) |
Preferred stock redemption charge |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6,412 |
) |
Net income attributable to |
|
$ |
222,989 |
|
|
$ |
111,703 |
|
|
$ |
366,044 |
|
|
$ |
203,372 |
|
Basic earnings per common share attributable to |
|
|
|
|
|
|
|
|
||||||||
Net income |
|
$ |
1.42 |
|
|
$ |
0.72 |
|
|
$ |
2.33 |
|
|
$ |
1.30 |
|
Weighted average number of common shares outstanding |
|
|
156,720 |
|
|
|
156,107 |
|
|
|
156,685 |
|
|
|
156,016 |
|
Diluted earnings per common share attributable to |
|
|
|
|
|
|
|
|
||||||||
Net income |
|
$ |
1.42 |
|
|
$ |
0.71 |
|
|
$ |
2.33 |
|
|
$ |
1.30 |
|
Weighted average number of common and common equivalent shares outstanding |
|
|
157,192 |
|
|
|
156,519 |
|
|
|
157,098 |
|
|
|
156,307 |
|
|
|||||||||||||||
FUNDS FROM OPERATIONS (1) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three months ended
|
|
Six months ended
|
||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
|
(in thousands, except for per share amounts) |
||||||||||||||
Net income attributable to |
$ |
222,989 |
|
|
$ |
111,703 |
|
|
$ |
366,044 |
|
|
$ |
203,372 |
|
Add: |
|
|
|
|
|
|
|
||||||||
Preferred stock redemption charge |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6,412 |
|
Preferred dividends |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,560 |
|
Noncontrolling interest - common units of the |
|
25,708 |
|
|
|
12,383 |
|
|
|
42,061 |
|
|
|
23,422 |
|
Noncontrolling interests in property partnerships |
|
18,546 |
|
|
|
17,164 |
|
|
|
36,095 |
|
|
|
33,631 |
|
Net income |
|
267,243 |
|
|
|
141,250 |
|
|
|
444,200 |
|
|
|
269,397 |
|
Add: |
|
|
|
|
|
|
|
||||||||
Depreciation and amortization expense |
|
183,146 |
|
|
|
183,838 |
|
|
|
360,770 |
|
|
|
360,403 |
|
Noncontrolling interests in property partnerships’ share of depreciation and amortization |
|
(17,414 |
) |
|
|
(17,113 |
) |
|
|
(35,067 |
) |
|
|
(33,570 |
) |
Company’s share of depreciation and amortization from unconsolidated joint ventures |
|
21,120 |
|
|
|
15,350 |
|
|
|
43,164 |
|
|
|
33,762 |
|
Corporate-related depreciation and amortization |
|
(413 |
) |
|
|
(444 |
) |
|
|
(817 |
) |
|
|
(884 |
) |
Less: |
|
|
|
|
|
|
|
||||||||
Gains on sale of investment included within income from unconsolidated joint ventures |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,257 |
|
Gains on sales of real estate |
|
96,247 |
|
|
|
7,756 |
|
|
|
118,948 |
|
|
|
7,756 |
|
Noncontrolling interests in property partnerships |
|
18,546 |
|
|
|
17,164 |
|
|
|
36,095 |
|
|
|
33,631 |
|
Preferred dividends |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,560 |
|
Preferred stock redemption charge |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6,412 |
|
Funds from operations (FFO) attributable to the |
|
338,889 |
|
|
|
297,961 |
|
|
|
657,207 |
|
|
|
568,492 |
|
Less: |
|
|
|
|
|
|
|
||||||||
Noncontrolling interest - common units of the Operating Partnership’s share of funds from operations |
|
34,329 |
|
|
|
29,319 |
|
|
|
66,509 |
|
|
|
55,940 |
|
Funds from operations attributable to |
$ |
304,560 |
|
|
$ |
268,642 |
|
|
$ |
590,698 |
|
|
$ |
512,552 |
|
|
|
89.87 |
% |
|
|
90.16 |
% |
|
|
89.88 |
% |
|
|
90.16 |
% |
Weighted average shares outstanding - basic |
|
156,720 |
|
|
|
156,107 |
|
|
|
156,685 |
|
|
|
156,016 |
|
FFO per share basic |
$ |
1.94 |
|
|
$ |
1.72 |
|
|
$ |
3.77 |
|
|
$ |
3.29 |
|
Weighted average shares outstanding - diluted |
|
157,192 |
|
|
|
156,519 |
|
|
|
157,098 |
|
|
|
156,307 |
|
FFO per share diluted |
$ |
1.94 |
|
|
$ |
1.72 |
|
|
$ |
3.76 |
|
|
$ |
3.28 |
(1) |
Pursuant to the revised definition of Funds from Operations adopted by the |
Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current Nareit definition or that interpret the current Nareit definition differently. |
|
In order to facilitate a clear understanding of the Company’s operating results, FFO should be examined in conjunction with net income attributable to |
|
|||
PORTFOLIO LEASING PERCENTAGES |
|||
|
|
|
|
|
% Leased by Location |
||
|
|
|
|
|
91.5 % |
|
91.4 % |
|
93.4 % |
|
88.8 % |
|
87.8 % |
|
87.6 % |
|
86.9 % |
|
87.3 % |
|
89.1 % |
|
90.9 % |
|
89.4 % |
|
87.2 % |
Total Portfolio |
89.5 % |
|
88.8 % |
View source version on businesswire.com: https://www.businesswire.com/news/home/20220726006099/en/
AT BXP
Executive Vice President,
Chief Financial Officer and Treasurer
mlabelle@bxp.com
Vice President, Investor Relations
hhan@bxp.com
Source:
FAQ
What were Boston Properties' Q2 2022 earnings results for BXP?
How much did Boston Properties increase its full-year guidance for EPS and FFO?
What significant leasing activity occurred in Q2 2022 for BXP?
What strategic acquisition did Boston Properties make in Q2 2022?