EastGroup Properties Announces Fourth Quarter and Full Year 2024 Results
EastGroup Properties (NYSE: EGP) reported its Q4 and full-year 2024 results, showing solid performance with FFO per share increasing 5.9% to $2.15 in Q4 and 7.9% to $8.31 for the full year. The company's operating portfolio maintained strong occupancy at 97.1% leased and 96.1% occupied as of December 31, 2024.
Key highlights include impressive rental rate growth, with new and renewal leases increasing by 46.6% in Q4 and 53.0% for the full year on a straight-line basis. The company expanded its portfolio through acquisitions of three operating properties totaling 1,790,000 square feet and 26.8 acres of development land for approximately $257 million in Q4.
Development activity remained robust with five new projects started in Q4, totaling 802,000 square feet with projected costs of $125 million. Same Property Net Operating Income showed positive growth, increasing 3.6% on a straight-line basis and 3.4% on a cash basis in Q4 2024 compared to Q4 2023.
EastGroup Properties (NYSE: EGP) ha riportato i risultati del quarto trimestre e dell'anno intero 2024, mostrando una performance solida con un FFO per azione in aumento del 5,9%, arrivando a $2,15 nel Q4 e del 7,9%, raggiungendo $8,31 per l'anno intero. Il portafoglio operativo dell'azienda ha mantenuto una forte occupazione con il 97,1% locato e il 96,1% occupato al 31 dicembre 2024.
I punti salienti includono una crescita impressionante delle tariffe di locazione, con nuovi contratti e rinnovi che sono aumentati del 46,6% nel Q4 e del 53,0% per l'anno intero su base lineare. L'azienda ha ampliato il suo portafoglio attraverso l'acquisizione di tre proprietà operative per un totale di 1.790.000 piedi quadrati e 26,8 acri di terreno per sviluppo per circa $257 milioni nel Q4.
Le attività di sviluppo sono rimaste robuste con cinque nuovi progetti avviati nel Q4, per un totale di 802.000 piedi quadrati e costi previsti di $125 milioni. Il reddito operativo netto della stessa proprietà ha mostrato una crescita positiva, aumentando del 3,6% su base lineare e del 3,4% su base monetaria nel Q4 2024 rispetto al Q4 2023.
EastGroup Properties (NYSE: EGP) reportó sus resultados del cuarto trimestre y del año completo 2024, mostrando un sólido desempeño con un FFO por acción que aumentó un 5.9% a $2.15 en el Q4 y un 7.9% a $8.31 para el año completo. La cartera operativa de la compañía mantuvo una fuerte ocupación, con un 97.1% arrendado y un 96.1% ocupado al 31 de diciembre de 2024.
Los aspectos más destacados incluyen un impresionante crecimiento en las tarifas de alquiler, con nuevos contratos y renovaciones que aumentaron un 46.6% en el Q4 y un 53.0% para el año completo en una base lineal. La compañía amplió su cartera mediante la adquisición de tres propiedades operativas que totalizan 1,790,000 pies cuadrados y 26.8 acres de terreno para desarrollo por aproximadamente $257 millones en el Q4.
La actividad de desarrollo se mantuvo robusta con cinco nuevos proyectos iniciados en el Q4, totalizando 802,000 pies cuadrados con costos proyectados de $125 millones. El Ingreso Neto de Explotación de Propiedades Comparables mostró un crecimiento positivo, aumentando un 3.6% en una base lineal y un 3.4% en una base de efectivo en el Q4 2024 en comparación con el Q4 2023.
EastGroup Properties (NYSE: EGP)는 2024년 4분기와 연간 결과를 발표하며, 4분기 주당 FFO가 5.9% 증가하여 $2.15에, 연간으로는 7.9% 증가하여 $8.31에 이르는 견실한 실적을 보여주었습니다. 회사의 운영 포트폴리오는 2024년 12월 31일 기준으로 97.1% 임대 및 96.1% 점유율로 강력한 점유율을 유지했습니다.
주요 하이라이트에는 인상적인 임대료 성장률이 포함되며, 신규 계약 및 갱신 계약이 4분기에 46.6%, 연간으로는 53.0% 증가했습니다. 회사는 4분기에 약 $2억 5천 7백만에 총 1,790,000 평방피트 및 26.8에이커의 개발용 토지를 포함한 3개의 운영 자산을 인수하여 포트폴리오를 확장했습니다.
개발 활동은 4분기에 시작된 5개의 신규 프로젝트로 지속적으로 활발하며, 총 802,000 평방피트와 예상 비용이 $1억 2천 5백만에 달합니다. 동일 자산 순 운영 소득은 긍정적인 성장세를 보여주며, 2023년 4분기에 비해 2024년 4분기에 순수 직선 기준으로 3.6%, 현금 기준으로 3.4% 증가했습니다.
EastGroup Properties (NYSE: EGP) a publié ses résultats pour le quatrième trimestre et pour l'ensemble de l'année 2024, affichant une performance solide avec un FFO par action augmentant de 5,9% à 2,15 $ au Q4 et de 7,9% à 8,31 $ pour l'année complète. Le portefeuille opérationnel de l'entreprise a maintenu un taux d'occupation élevé de 97,1% loué et 96,1% occupé au 31 décembre 2024.
Les faits marquants comprennent une impressionnante croissance des taux de location, avec des baux nouveaux et renouvelés augmentant de 46,6% au Q4 et de 53,0% pour l'année entière sur une base linéaire. L'entreprise a élargi son portefeuille par l'acquisition de trois propriétés opérationnelles totalisant 1 790 000 pieds carrés et 26,8 acres de terrain pour développement pour environ 257 millions de dollars au Q4.
L'activité de développement est restée robuste avec cinq nouveaux projets lancés au Q4, totalisant 802 000 pieds carrés avec des coûts prévus de 125 millions de dollars. Le revenu net d'exploitation des propriétés comparables a montré une croissance positive, augmentant de 3,6% sur une base linéaire et de 3,4% sur une base de trésorerie au Q4 2024 par rapport au Q4 2023.
EastGroup Properties (NYSE: EGP) hat seine Ergebnisse für das vierte Quartal und das gesamte Jahr 2024 veröffentlicht, die eine solide Leistung zeigen, wobei der FFO pro Aktie im vierten Quartal um 5,9% auf $2,15 und für das gesamte Jahr um 7,9% auf $8,31 gestiegen ist. Das Betriebsportfolio des Unternehmens hatte eine starke Belegung mit 97,1% vermietet und 96,1% belegt zum 31. Dezember 2024.
Zu den wichtigsten Punkten gehören beeindruckende Wachstumsraten bei den Mieten, da sich neue und erneuerte Mietverträge im vierten Quartal um 46,6% und im gesamten Jahr um 53,0% auf einer linearen Basis erhöht haben. Das Unternehmen hat sein Portfolio durch den Erwerb von drei Betriebsimmobilien, die insgesamt 1.790.000 Quadratfuß und 26,8 Acres Entwicklungsland für etwa 257 Millionen Dollar im vierten Quartal umfassen, erweitert.
Die Bautätigkeit blieb mit fünf neuen Projekten, die im vierten Quartal gestartet wurden und insgesamt 802.000 Quadratfuß mit voraussichtlichen Kosten von 125 Millionen Dollar umfasst, robust. Das Netto-Betriebsergebnis derselben Immobilie zeigte ein positives Wachstum und stieg im vierten Quartal 2024 im Vergleich zum vierten Quartal 2023 um 3,6% auf einer linearen Basis und um 3,4% auf einer Cash-Basis.
- FFO per share increased 5.9% to $2.15 in Q4 2024 and 7.9% to $8.31 for full-year 2024
- Strong rental rate growth with 46.6% increase in Q4 and 53.0% for full-year on new and renewal leases
- High occupancy rates with operating portfolio 97.1% leased and 96.1% occupied
- Same Property NOI growth of 3.6% on straight-line basis in Q4
- Significant portfolio expansion with $404 million in acquisitions for full-year 2024
- Net Income per share decreased to $1.16 in Q4 2024 from $1.35 in Q4 2023
- Average occupancy declined to 95.8% in Q4 2024 from 98.1% in Q4 2023
- Average occupancy for full-year 2024 decreased to 96.8% from 98.0% in 2023
Insights
EastGroup Properties' Q4 2024 results demonstrate exceptional execution in the industrial real estate sector, with several standout metrics worth analyzing. The 46.6% rental rate spread on new and renewal leases signals tremendous pricing power and embedded growth potential within the portfolio. This pricing strength, combined with 97.1% portfolio occupancy, indicates robust demand for EGP's Sunbelt-focused industrial assets despite broader market uncertainties.
The company's strategic growth initiatives are particularly noteworthy. The $257M acquisition of three fully-leased properties in Atlanta, Dallas-Fort Worth and Phoenix strengthens EGP's presence in key logistics markets. The development pipeline of 4.14M square feet with a projected 7.8% stabilized yield provides attractive organic growth opportunities, especially considering CEO Marshall Loeb's observation about "materially shrinking industrial supply pipeline" which should support continued strong rental rate growth.
Financial metrics reflect exemplary balance sheet management with 15.4% debt-to-market cap and 3.20x debt/EBITDAre. The company's proactive capital management, including
Fourth Quarter 2024 Highlights
- Net Income Attributable to Common Stockholders of
$1.16 $1.35 $13 Million $0.28 - Funds from Operations ("FFO") Excluding Gain on Involuntary Conversion and Business Interruption Claims of
$2.15 $2.03 5.9% - Same Property Net Operating Income for the Same Property Pool Excluding Income From Lease Terminations Increased
3.6% on a Straight-Line Basis and3.4% on a Cash Basis for Fourth Quarter 2024 Compared to the Same Period in 2023 - Operating Portfolio was
97.1% Leased and96.1% Occupied as of December 31, 2024; Average Occupancy of Operating Portfolio was95.8% for Fourth Quarter 2024 as Compared to98.1% for Fourth Quarter 2023 - Rental Rates on New and Renewal Leases Increased an Average of
46.6% on a Straight-Line Basis - Acquired Three Operating Properties Containing 1,790,000 Square Feet and 26.8 Acres of Development Land for Approximately
$257 Million - Started Construction of Five Development Projects Totaling 802,000 Square Feet with Projected Total Costs of Approximately
$125 Million - Transferred One Development Project Containing 357,000 Square Feet to the Operating Portfolio
Full Year 2024 Highlights
- Net Income Attributable to Common Stockholders of
$4.66 $4.42 $9 Million $0.18 $18 Million $0.40 - FFO Excluding Gain on Involuntary Conversion and Business Interruption Claims of
$8.31 $7.70 7.9% - Same Property Net Operating Income for the Same Property Pool Excluding Income From Lease Terminations Increased
4.8% on a Straight-Line Basis and5.6% on a Cash Basis for 2024 Compared to 2023 - Average Occupancy of Operating Portfolio was
96.8% for 2024 as Compared to98.0% for 2023 - Rental Rates on New and Renewal Leases Increased an Average of
53.0% on a Straight-Line Basis - Acquired Six Operating Properties Containing 2,474,000 Square Feet and 61.1 Acres of Development Land for Approximately
$404 Million - Started Construction of 10 Development Projects Totaling 1,585,000 Square Feet with Projected Total Costs of Approximately
$230 Million - Transferred Seven Development Projects Containing 1,519,000 Square Feet to the Operating Portfolio
Commenting on EastGroup's performance, Marshall Loeb, CEO, stated, "Our consistent, positive performance continues as evidenced by FFO per share excluding gain on involuntary conversion and business interruption claims rising
EARNINGS PER SHARE
Three Months Ended December 31, 2024
On a diluted per share basis, earnings per common share ("EPS") were
- EastGroup recognized gains on sales of real estate investments of
$13,156,000 $0.28 - Depreciation and amortization expense was
$49,662,000 $0.99 $45,248,000 $0.96 - Weighted average shares increased by 3,359,000 on a diluted basis during the three months ended December 31, 2024, as compared to the same period of 2023.
The decrease in EPS was partially offset by the following:
- The Company's property net operating income ("PNOI") was
$120,867,000 $2.40 $109,952,000 $2.34 - Interest expense was
$9,192,000 $0.18 $11,108,000 $0.24
Twelve Months Ended December 31, 2024
Diluted EPS for the twelve months ended December 31, 2024 was
- PNOI was
$464,995,000 $9.51 $413,321,000 $9.12 - Interest expense was
$38,956,000 $0.80 $47,996,000 $1.06
The increase in EPS was partially offset by the following:
- Depreciation and amortization expense was
$189,411,000 $3.87 $171,078,000 $3.77 - EastGroup recognized gains on sales of real estate investments of
$8,751,000 $0.18 $17,965,000 $0.40 - Weighted average shares increased by 3,580,000 on a diluted basis during the twelve months ended December 31, 2024, as compared to the same period of 2023.
FUNDS FROM OPERATIONS AND PROPERTY NET OPERATING INCOME
Three Months Ended December 31, 2024
For the three months ended December 31, 2024, funds from operations attributable to common stockholders ("FFO") were
PNOI increased by
Same PNOI Excluding Income from Lease Terminations increased
On a straight-line basis, rental rates on new and renewal leases (representing
Twelve Months Ended December 31, 2024
FFO for the twelve months ended December 31, 2024, was
FFO Excluding Gain on Involuntary Conversion and Business Interruption Claims was
PNOI increased by
Same PNOI Excluding Income from Lease Terminations increased
On a straight-line basis, rental rates on new and renewal leases (representing
The same property pool for the three and twelve months ended December 31, 2024 includes properties which were included in the operating portfolio for the entire period from January 1, 2023 through December 31, 2024; this pool is comprised of properties containing 51,668,000 square feet.
FFO, FFO Excluding Gain on Involuntary Conversion and Business Interruption Claims, PNOI and Same PNOI are non-GAAP financial measures, which are defined under Definitions later in this release. Reconciliations of Net Income to PNOI and Same PNOI, and Net Income Attributable to EastGroup Properties, Inc. Common Stockholders to FFO and FFO Excluding Gain on Involuntary Conversion and Business Interruption Claims are presented in the attached schedule "Reconciliations of GAAP to Non-GAAP Measures."
ACQUISITIONS AND DISPOSITIONS
As previously announced, during the three months ended December 31, 2024, EastGroup acquired three operating properties containing 1,790,000 square feet for approximately
In November, the Company acquired three business distribution buildings, known as Riverpoint Industrial Park, totaling 779,000 square feet, in
Also in November, EastGroup acquired DFW Global Logistics Centre 5-8, four multi-tenant business distribution buildings totaling 492,000 square feet, for approximately
In December, the Company acquired Akimel Gateway, which contains four business distribution buildings totaling 519,000 square feet in
EastGroup also acquired 26.8 acres of development land in the
In aggregate, during the twelve months ended December 31, 2024, EastGroup acquired 2,474,000 square feet of operating properties for
For the twelve months ended December 31, 2024, the Company sold a portfolio of properties in the
DEVELOPMENT AND VALUE-ADD PROPERTIES
During the fourth quarter of 2024, EastGroup began construction of five new development projects in four markets, which are expected to contain a total of 802,000 square feet and have projected total costs of
The development projects started during 2024 are detailed in the table below:
Development Projects Started in 2024 | Location | Size | Anticipated Conversion | Projected Total Costs | |||||||||||||||||||||||||
(Square feet) | (In thousands) | ||||||||||||||||||||||||||||
Horizon West 5 | 85,000 | 12/2025 | $ | 12,800 | |||||||||||||||||||||||||
Northeast Trade Center 1 | 264,000 | 04/2025 | 32,100 | ||||||||||||||||||||||||||
Crossroads 1 | 124,000 | 06/2025 | 20,000 | ||||||||||||||||||||||||||
Texas Avenue 1 & 2 | 129,000 | 05/2026 | 22,500 | ||||||||||||||||||||||||||
World | 181,000 | 06/2026 | 17,900 | ||||||||||||||||||||||||||
Crossroads 2 | 203,000 | 07/2026 | 32,300 | ||||||||||||||||||||||||||
Grand West Crossing 2 | 97,000 | 08/2026 | 12,900 | ||||||||||||||||||||||||||
Hillside 2 | 141,000 | 10/2026 | 15,300 | ||||||||||||||||||||||||||
Gateway Interchange A & B | 137,000 | 01/2027 | 26,200 | ||||||||||||||||||||||||||
Gateway Interchange F & G | 224,000 | 01/2027 | 38,000 | ||||||||||||||||||||||||||
Total Development Projects Started | 1,585,000 | $ | 230,000 | ||||||||||||||||||||||||||
At December 31, 2024, EastGroup's development and value-add program consisted of 21 projects (4,143,000 square feet) in 14 markets. The projects, which were collectively
During the fourth quarter of 2024, EastGroup transferred one project, known as Horizon West 10, to the operating portfolio. The Company transfers projects to the portfolio at the earlier of
The development projects transferred to the operating portfolio during 2024 are detailed in the table below:
Development and Value-Add Properties | Location | Size | Conversion Date | Cumulative Cost as | Percent Leased | |||||||||||||||||||||||||||
(Square feet) | (In thousands) | |||||||||||||||||||||||||||||||
Gateway 2 | 133,000 | 02/2024 | $ | 22,426 | 100 % | |||||||||||||||||||||||||||
Hillside 1 | 122,000 | 04/2024 | 13,184 | 100 % | ||||||||||||||||||||||||||||
172,000 | 06/2024 | 27,522 | 100 % | |||||||||||||||||||||||||||||
MCO Logistics Center | 167,000 | 07/2024 | 24,712 | 100 % | ||||||||||||||||||||||||||||
Stonefield 35 1-3 | 276,000 | 08/2024 | 36,997 | 56 % | ||||||||||||||||||||||||||||
Springwood 1 & 2 | 292,000 | 09/2024 | 34,837 | 93 % | ||||||||||||||||||||||||||||
Horizon West 10 | 357,000 | 10/2024 | 42,370 | 100 % | ||||||||||||||||||||||||||||
Total Projects Transferred | 1,519,000 | $ | 202,048 | 91 % | ||||||||||||||||||||||||||||
Projected Stabilized Yield(1) | 7.8 % | |||||||||||||||||||||||||||||||
(1) Weighted average yield based on projected stabilized annual property net operating income on a straight-line basis at |
DIVIDENDS
EastGroup declared a cash dividend of
FINANCIAL STRENGTH AND FLEXIBILITY
EastGroup continues to maintain a strong and flexible balance sheet. Debt-to-total market capitalization was
In December, EastGroup repaid two senior unsecured notes totaling
The Company did not enter into any new secured or unsecured debt agreements during the three and twelve months ended December 31, 2024. The Company also had minimal draws on its unsecured credit facilities, with a weighted average balance of
Subsequent to year end, EastGroup refinanced a
During the fourth quarter, EastGroup sold 914,780 shares of common stock directly through its sales agents under its continuous common equity offering program at a weighted average price of
During the fourth quarter, EastGroup settled outstanding forward equity sale agreements that were previously entered into under its continuous common equity offering program by issuing 1,704,863 shares of common stock in exchange for net proceeds of approximately
During the three months ended December 31, 2024, the Company entered into forward equity sale agreements with respect to 690,953 shares of common stock with an initial weighted average forward price of
OUTLOOK FOR 2025
We estimate EPS for 2025 to be in the range of
EastGroup's projections are based on management's current beliefs and assumptions about our business, the industry and the markets in which we operate; there are known and unknown risks and uncertainties associated with these projections. We assume no obligation to update publicly any forward-looking statements, including our Outlook for 2025, whether as a result of new information, future events or otherwise. Please refer to the "Forward-Looking Statements" disclosures included in this earnings release and "Risk Factors" disclosed in our annual and quarterly reports filed with the Securities and Exchange Commission for more information.
The following table presents the guidance range for 2025:
Low Range | High Range | |||||||||||||||||||||||||
Q1 2025 | Y/E 2025 | Q1 2025 | Y/E 2025 | |||||||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 55,378 | 248,094 | 59,544 | 258,632 | |||||||||||||||||||||
Depreciation and amortization | 51,353 | 215,768 | 51,353 | 215,768 | ||||||||||||||||||||||
Funds from operations attributable to common stockholders* | $ | 106,731 | 463,862 | 110,897 | 474,400 | |||||||||||||||||||||
Weighted average shares outstanding - Diluted | 52,070 | 52,686 | 52,070 | 52,686 | ||||||||||||||||||||||
Per share data (diluted): | ||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 1.06 | 4.71 | 1.14 | 4.91 | |||||||||||||||||||||
Funds from operations attributable to common stockholders | 2.05 | 8.80 | 2.13 | 9.00 | ||||||||||||||||||||||
*This is a non-GAAP financial measure. Please refer to Definitions. |
The following assumptions were used for the mid-point:
Metrics | Initial Guidance for | Actual for Year 2024 | ||||||||||||||||||
FFO per share | ||||||||||||||||||||
FFO per share increase over prior year | 6.6 % | 7.2 % | ||||||||||||||||||
FFO per share increase over prior year excluding gain on | 7.1 % | 7.9 % | ||||||||||||||||||
Same PNOI growth: cash basis (1) | 5.6 % | |||||||||||||||||||
Average month-end occupancy - operating portfolio | 96.8 % | |||||||||||||||||||
Development starts: | ||||||||||||||||||||
Square feet | 2.5 million | 1.6 million | ||||||||||||||||||
Projected total investment | ||||||||||||||||||||
Operating property acquisitions | ||||||||||||||||||||
Operating property dispositions (Potential gains on dispositions are not included in the projections) | ||||||||||||||||||||
Capital proceeds | ||||||||||||||||||||
General and administrative expense (3) | ||||||||||||||||||||
(1) Excludes straight-line rent adjustments, amortization of market rent intangibles for acquired leases, and income from lease terminations. |
(2) Includes properties which have been in the operating portfolio since 1/1/24 and are projected to be in the operating portfolio through 12/31/25; includes 54,633,000 square feet. |
(3) Approximately |
DEFINITIONS
The Company's chief decision maker uses Net income as the primary measure of operating results in making decisions. Investor and industry analysts primarily utilize two supplemental operating performance measures in analyzing operating results, which include: (1) funds from operations attributable to common stockholders ("FFO"), including FFO as adjusted as described below, and (2) property net operating income ("PNOI"), as defined below.
FFO is computed in accordance with standards established by the National Association of Real Estate Investment Trusts, Inc. ("Nareit"). Nareit's guidance allows preparers an option as it pertains to whether gains or losses on sale, or impairment charges, on real estate assets incidental to a real estate investment trust's ("REIT's") business are excluded from the calculation of FFO. EastGroup has made the election to exclude activity related to such assets that are incidental to our business. FFO is calculated as net income (loss) attributable to common stockholders computed in accordance with
FFO Excluding Gain on Involuntary Conversion and Business Interruption Claims is calculated as FFO (as defined above), adjusted to exclude gains on involuntary conversion and business interruption claims. The Company believes that this exclusion presents a more meaningful comparison of operating performance across periods.
PNOI is defined as Income from real estate operations less Expenses from real estate operations (including market-based internal management fee expense) plus the Company's share of income and property operating expenses from its less-than-wholly-owned real estate investments. EastGroup sometimes refers to PNOI from Same Properties as "Same PNOI" in this press release and the accompanying reconciliation; the Company also presents Same PNOI Excluding Income from Lease Terminations. The Company presents Same PNOI and Same PNOI Excluding Income from Lease Terminations as a property-level supplemental measure of performance used to evaluate the performance of the Company's investments in real estate assets and its operating results on a same property basis. The Company believes it is useful to evaluate Same PNOI Excluding Income from Lease Terminations on both a straight-line and cash basis. The straight-line basis is calculated by averaging the customers' rent payments over the lives of the leases; GAAP requires the recognition of rental income on a straight-line basis. The cash basis excludes adjustments for straight-line rent and amortization of market rent intangibles for acquired leases; cash basis is an indicator of the rents charged to customers by the Company during the periods presented and is useful in analyzing the embedded rent growth in the Company's portfolio. "Same Properties" is defined as operating properties owned during the entire current period and prior year reporting period. Operating properties are stabilized real estate properties (land including building and improvements) that make up the Company's operating portfolio. Properties developed or acquired are excluded from the same property pool until held in the operating portfolio for both the current and prior year reporting periods. Properties sold during the current or prior year reporting periods are also excluded.
FFO and PNOI are supplemental industry reporting measurements used to evaluate the performance of the Company's investments in real estate assets and its operating results. The Company believes that the exclusion of depreciation and amortization in the industry's calculations of PNOI and FFO provides supplemental indicators of the properties' performance since real estate values have historically risen or fallen with market conditions. PNOI and FFO as calculated by the Company may not be comparable to similarly titled but differently calculated measures for other REITs. Investors should be aware that items excluded from or added back to FFO are significant components in understanding and assessing the Company's financial performance.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate ("EBITDAre") is also a key performance measure. EBITDAre is computed in accordance with standards established by Nareit and defined as Net Income, adjusted for gains and losses from sales of real estate investments, non-operating real estate and other assets incidental to the Company's business, interest expense, income tax expense, depreciation and amortization. EBITDAre is a non-GAAP financial measure used to measure the Company's operating performance and its ability to meet interest payment obligations and pay quarterly stock dividends on an unleveraged basis.
Debt-to-EBITDAre ratio is a non-GAAP financial measure calculated by dividing the Company's debt by its EBITDAre, and is used in analyzing the financial condition and operating performance of the Company relative to its leverage.
The Company's interest and fixed charge coverage ratio is a non-GAAP financial measure calculated by dividing the Company's EBITDAre by its interest expense. We believe this ratio is useful to investors because it provides a basis for analysis of the Company's leverage, operating performance and its ability to service the interest payments due on its debt.
CONFERENCE CALL
EastGroup will host a conference call and webcast to discuss the results of its fourth quarter, review the Company's current operations, and present its earnings outlook for 2025 on Friday, February 7, 2025, at 11:00 a.m. Eastern Time. A live broadcast of the conference call is available by dialing 1-800-836-8184 (conference ID: EastGroup) or by webcast through a link on the Company's website at www.eastgroup.net. If you are unable to listen to the live conference call, a telephone and webcast replay will be available through Friday, February 14, 2025. The telephone replay can be accessed by dialing 1-888-660-6345 (access code 93780#), and the webcast replay can be accessed through a link on the Company's website at www.eastgroup.net.
SUPPLEMENTAL INFORMATION
Supplemental financial information is available under Quarterly Results in the Investor Relations section of the Company's website at www.eastgroup.net or upon request by calling the Company at 601-354-3555.
COMPANY INFORMATION
EastGroup Properties, Inc. (NYSE: EGP), a member of the S&P Mid-Cap 400 and Russell 2000 Indexes, is a self-administered equity real estate investment trust focused on the development, acquisition and operation of industrial properties in major Sunbelt markets throughout
The Company announces information about the Company and its business to investors and the public using the Company's website (eastgroup.net), including the investor relations website (investor.eastgroup.net), filings with the Securities and Exchange Commission, press releases, public conference calls, and webcasts. The Company also uses social media to communicate with its investors and the public. While not all the information that the Company posts to the Company's website or on the Company's social media channels is of a material nature, some information could be deemed to be material. Therefore, the Company encourages investors, the media, and others interested in the Company to review the information that it posts on the social media channels, including Facebook (facebook.com/eastgroupproperties), LinkedIn (linkedin.com/company/eastgroup-properties-inc), and X (X.com/eastgroupprop). The list of social media channels that the company uses may be updated on its investor relations website from time to time. The information contained on, or that may be accessed through, our website or any of our social media channels is not incorporated by reference into, and is not a part of, this document.
FORWARD-LOOKING STATEMENTS
The statements and certain other information contained in this press release, which can be identified by the use of forward-looking terminology such as "may," "will," "seek," "expects," "anticipates," "believes," "targets," "intends," "should," "estimates," "could," "continue," "assume," "projects," "goals," "plans" or variations of such words and similar expressions or the negative of such words, constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbors created thereby. These forward-looking statements reflect the Company's current views about its plans, intentions, expectations, strategies and prospects, which are based on the information currently available to the Company and on assumptions it has made. For instance, the amount, timing and frequency of future dividends is subject to authorization by the Company's Board of Directors and will be based upon a variety of factors. Although the Company believes that its plans, intentions, expectations, strategies and prospects as reflected in or suggested by those forward-looking statements are reasonable, the Company can give no assurance that such plans, intentions, expectations or strategies will be attained or achieved. Furthermore, these forward-looking statements should be considered as subject to the many risks and uncertainties that exist in the Company's operations and business environment. Such risks and uncertainties could cause actual results to differ materially from those projected. These uncertainties include, but are not limited to:
- international, national, regional and local economic conditions;
- the competitive environment in which the Company operates;
- fluctuations of occupancy or rental rates;
- potential defaults (including bankruptcies or insolvency) on or non-renewal of leases by tenants, or our ability to lease space at current or anticipated rents, particularly in light of ongoing interest rate uncertainty;
- disruption in supply and delivery chains;
- increased construction and development costs, including as a result of the recent inflationary environment;
- acquisition and development risks, including failure of such acquisitions and development projects to perform in accordance with our projections or to materialize at all;
- potential changes in the law or governmental regulations and interpretations of those laws and regulations, including changes in real estate laws, REIT or corporate income tax laws, potential changes in zoning laws, or increases in real property tax rates, and any related increased cost of compliance;
- our ability to maintain our qualification as a REIT;
- natural disasters such as fires, floods, tornadoes, hurricanes, earthquakes or other extreme weather events, which may or may not be caused by longer-term shifts in climate patterns, could destroy buildings and damage regional economies;
- the availability of financing and capital, increases in or long-term elevated interest rates, and our ability to raise equity capital on attractive terms;
- financing risks, including the risks that our cash flows from operations may be insufficient to meet required payments of principal and interest, and we may be unable to refinance our existing debt upon maturity or obtain new financing on attractive terms or at all;
- our ability to retain our credit agency ratings;
- our ability to comply with applicable financial covenants;
- credit risk in the event of non-performance by the counterparties to our interest rate swaps;
- how and when pending forward equity sales may settle;
- lack of or insufficient amounts of insurance;
- litigation, including costs associated with prosecuting or defending claims and any adverse outcomes;
- our ability to attract and retain key personnel or lack of adequate succession planning;
- risks related to the failure, inadequacy or interruption of our data security systems and processes, including security breaches through cyber attacks;
- pandemics, epidemics or other public health emergencies, such as the coronavirus pandemic;
- potentially catastrophic events such as acts of war, civil unrest and terrorism; and
- environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of properties presently owned or previously owned by us.
All forward-looking statements should be read in light of the risks identified in Part I, Item 1A. Risk Factors within the Company's most recent Annual Report on Form 10-K, as such factors may be updated from time to time in the Company's periodic filings and current reports filed with the SEC.
The Company assumes no obligation to update publicly any forward-looking statements, including its Outlook for 2025, whether as a result of new information, future events or otherwise.
CONTACT
EASTGROUP PROPERTIES, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||||||||||||||||||||||||||
(IN THOUSANDS, EXCEPT PER SHARE DATA) | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
REVENUES | ||||||||||||||||||||||||||
Income from real estate operations | $ | 163,767 | 149,026 | 638,035 | 566,179 | |||||||||||||||||||||
Other revenue | 277 | 123 | 2,199 | 4,412 | ||||||||||||||||||||||
164,044 | 149,149 | 640,234 | 570,591 | |||||||||||||||||||||||
EXPENSES | ||||||||||||||||||||||||||
Expenses from real estate operations | 43,195 | 39,368 | 174,212 | 154,030 | ||||||||||||||||||||||
Depreciation and amortization | 49,662 | 45,248 | 189,411 | 171,078 | ||||||||||||||||||||||
General and administrative | 4,043 | 3,740 | 20,619 | 16,757 | ||||||||||||||||||||||
Indirect leasing costs | 229 | 146 | 785 | 582 | ||||||||||||||||||||||
97,129 | 88,502 | 385,027 | 342,447 | |||||||||||||||||||||||
OTHER INCOME (EXPENSE) | ||||||||||||||||||||||||||
Interest expense | (9,192) | (11,108) | (38,956) | (47,996) | ||||||||||||||||||||||
Gain on sales of real estate investments | — | 13,156 | 8,751 | 17,965 | ||||||||||||||||||||||
Other | 931 | 774 | 2,805 | 2,435 | ||||||||||||||||||||||
NET INCOME | 58,654 | 63,469 | 227,807 | 200,548 | ||||||||||||||||||||||
Net income attributable to noncontrolling interest in joint ventures | (14) | (14) | (56) | (57) | ||||||||||||||||||||||
NET INCOME ATTRIBUTABLE TO EASTGROUP PROPERTIES, INC. COMMON STOCKHOLDERS | 58,640 | 63,455 | 227,751 | 200,491 | ||||||||||||||||||||||
Other comprehensive income (loss) — interest rate swaps | 8,013 | (17,200) | (2,935) | (11,483) | ||||||||||||||||||||||
TOTAL COMPREHENSIVE INCOME | $ | 66,653 | 46,255 | 224,816 | 189,008 | |||||||||||||||||||||
BASIC PER COMMON SHARE DATA FOR NET INCOME ATTRIBUTABLE TO EASTGROUP | ||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 1.17 | 1.35 | 4.67 | 4.43 | |||||||||||||||||||||
Weighted average shares outstanding — Basic | 50,241 | 46,831 | 48,803 | 45,224 | ||||||||||||||||||||||
DILUTED PER COMMON SHARE DATA FOR NET INCOME ATTRIBUTABLE TO EASTGROUP | ||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 1.16 | 1.35 | 4.66 | 4.42 | |||||||||||||||||||||
Weighted average shares outstanding — Diluted | 50,339 | 46,980 | 48,911 | 45,331 | ||||||||||||||||||||||
EASTGROUP PROPERTIES, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES | ||||||||||||||||||||||||||
(IN THOUSANDS, EXCEPT PER SHARE DATA) | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
NET INCOME ATTRIBUTABLE TO EASTGROUP PROPERTIES, INC. COMMON STOCKHOLDERS | $ | 58,640 | 63,455 | 227,751 | 200,491 | |||||||||||||||||||||
Depreciation and amortization | 49,662 | 45,248 | 189,411 | 171,078 | ||||||||||||||||||||||
Company's share of depreciation from unconsolidated investment | 31 | 31 | 125 | 124 | ||||||||||||||||||||||
Depreciation and amortization attributable to noncontrolling interest | (1) | (1) | (5) | (5) | ||||||||||||||||||||||
Gain on sales of real estate investments | — | (13,156) | (8,751) | (17,965) | ||||||||||||||||||||||
Gain on sales of non-operating real estate | (140) | — | (362) | (446) | ||||||||||||||||||||||
FUNDS FROM OPERATIONS ("FFO") ATTRIBUTABLE TO COMMON STOCKHOLDERS* | 108,192 | 95,577 | 408,169 | 353,277 | ||||||||||||||||||||||
Gain on involuntary conversion and business interruption claims | — | — | (1,708) | (4,187) | ||||||||||||||||||||||
FFO ATTRIBUTABLE TO COMMON STOCKHOLDERS - EXCLUDING GAIN ON INVOLUNTARY | $ | 108,192 | 95,577 | 406,461 | 349,090 | |||||||||||||||||||||
NET INCOME | $ | 58,654 | 63,469 | 227,807 | 200,548 | |||||||||||||||||||||
Interest expense (1) | 9,192 | 11,108 | 38,956 | 47,996 | ||||||||||||||||||||||
Depreciation and amortization | 49,662 | 45,248 | 189,411 | 171,078 | ||||||||||||||||||||||
Company's share of depreciation from unconsolidated investment | 31 | 31 | 125 | 124 | ||||||||||||||||||||||
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA") | 117,539 | 119,856 | 456,299 | 419,746 | ||||||||||||||||||||||
Gain on sales of real estate investments | — | (13,156) | (8,751) | (17,965) | ||||||||||||||||||||||
Gain on sales of non-operating real estate | (140) | — | (362) | (446) | ||||||||||||||||||||||
EBITDA FOR REAL ESTATE ("EBITDAre")* | $ | 117,399 | 106,700 | 447,186 | 401,335 | |||||||||||||||||||||
Debt | $ | 1,503,562 | 1,674,827 | 1,503,562 | 1,674,827 | |||||||||||||||||||||
Debt-to-EBITDAre ratio* | 3.20 | 3.92 | 3.36 | 4.17 | ||||||||||||||||||||||
EBITDAre* | $ | 117,399 | 106,700 | 447,186 | 401,335 | |||||||||||||||||||||
Interest expense (1) | 9,192 | 11,108 | 38,956 | 47,996 | ||||||||||||||||||||||
Interest and fixed charge coverage ratio* | 12.77 | 9.61 | 11.48 | 8.36 | ||||||||||||||||||||||
DILUTED PER COMMON SHARE DATA FOR EASTGROUP PROPERTIES, INC. | ||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 1.16 | 1.35 | 4.66 | 4.42 | |||||||||||||||||||||
FFO attributable to common stockholders* | $ | 2.15 | 2.03 | 8.35 | 7.79 | |||||||||||||||||||||
FFO attributable to common stockholders - excluding gain on involuntary conversion and | $ | 2.15 | 2.03 | 8.31 | 7.70 | |||||||||||||||||||||
Weighted average shares outstanding for EPS and FFO purposes - Diluted | 50,339 | 46,980 | 48,911 | 45,331 | ||||||||||||||||||||||
(1) Net of capitalized interest of | ||||||||||||||||||||||||||
*This is a non-GAAP financial measure. Please refer to Definitions. | ||||||||||||||||||||||||||
EASTGROUP PROPERTIES, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES (Continued) | ||||||||||||||||||||||||||
(IN THOUSANDS) | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
NET INCOME | $ | 58,654 | 63,469 | 227,807 | 200,548 | |||||||||||||||||||||
Gain on sales of real estate investments | — | (13,156) | (8,751) | (17,965) | ||||||||||||||||||||||
Gain on sales of non-operating real estate | (140) | — | (362) | (446) | ||||||||||||||||||||||
Interest income | (512) | (496) | (1,334) | (879) | ||||||||||||||||||||||
Other revenue | (277) | (123) | (2,199) | (4,412) | ||||||||||||||||||||||
Indirect leasing costs | 229 | 146 | 785 | 582 | ||||||||||||||||||||||
Depreciation and amortization | 49,662 | 45,248 | 189,411 | 171,078 | ||||||||||||||||||||||
Company's share of depreciation from unconsolidated investment | 31 | 31 | 125 | 124 | ||||||||||||||||||||||
Interest expense (1) | 9,192 | 11,108 | 38,956 | 47,996 | ||||||||||||||||||||||
General and administrative expense (2) | 4,043 | 3,740 | 20,619 | 16,757 | ||||||||||||||||||||||
Noncontrolling interest in PNOI of consolidated joint ventures | (15) | (15) | (62) | (62) | ||||||||||||||||||||||
PROPERTY NET OPERATING INCOME ("PNOI")* | 120,867 | 109,952 | 464,995 | 413,321 | ||||||||||||||||||||||
PNOI from 2023 and 2024 acquisitions | (6,888) | (2,072) | (19,249) | (3,334) | ||||||||||||||||||||||
PNOI from 2023 and 2024 development and value-add properties | (9,361) | (5,806) | (31,544) | (13,190) | ||||||||||||||||||||||
PNOI from 2023 and 2024 operating property dispositions | — | (686) | (177) | (2,819) | ||||||||||||||||||||||
Other PNOI | 85 | (81) | 208 | 166 | ||||||||||||||||||||||
SAME PNOI (Straight-Line Basis)* | 104,703 | 101,307 | 414,233 | 394,144 | ||||||||||||||||||||||
Lease termination fee income from same properties | (235) | (488) | (2,192) | (1,020) | ||||||||||||||||||||||
SAME PNOI EXCLUDING INCOME FROM LEASE TERMINATIONS (Straight-Line Basis)* | 104,468 | 100,819 | 412,041 | 393,124 | ||||||||||||||||||||||
Straight-line rent adjustments for same properties | (1,521) | (1,152) | (4,560) | (6,429) | ||||||||||||||||||||||
Acquired leases — market rent adjustment amortization for same properties | (324) | (441) | (1,400) | (2,045) | ||||||||||||||||||||||
SAME PNOI EXCLUDING INCOME FROM LEASE TERMINATIONS (Cash Basis)* | $ | 102,623 | 99,226 | 406,081 | 384,650 | |||||||||||||||||||||
(1) Net of capitalized interest of | ||||||||||||||||||||||||||
(2) Net of capitalized development costs of | ||||||||||||||||||||||||||
*This is a non-GAAP financial measure. Please refer to Definitions. | ||||||||||||||||||||||||||
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SOURCE EastGroup Properties
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