Corporación Inmobiliaria Vesta Reports Fourth Quarter 2024 Earnings Results

Rhea-AI Summary

Vesta (NYSE: VTMX) reported strong Q4 2024 results with total income reaching US$ 252.3 million for full-year 2024, a 17.7% year-over-year increase exceeding guidance. The company achieved notable leasing activity of 7.7 million sf in 2024, with Q4 reaching 1.6 million sf. Total portfolio occupancy hit 93.4% in Q4.

Q4 2024 financial highlights include revenue of US$ 65.2 million (+16.5% YoY), Adjusted NOI of US$ 59.1 million (+11.7% YoY), and Adjusted EBITDA of US$ 52.3 million (+18.5% YoY). Vesta FFO reached US$ 160.1 million for 2024, up 25.2% from 2023.

The company secured a US$ 545 million Global Syndicated Sustainable Credit Facility and completed US$ 42.3 million in share repurchases. New construction totaled 2.6 million square feet in 2024, with an 11.0% weighted average yield on cost.

Positive

• Total income increased 17.7% YoY to US$ 252.3 million
• FFO grew 25.2% to US$ 160.1 million in 2024
• Strong leasing activity with 7.7 million sf in 2024
• Secured US$ 545 million Sustainable Credit Facility
• High portfolio occupancy rate of 93.4%
• 11.0% weighted average yield on new construction

Negative

• NOI margin decreased 460 basis points YoY in Q4
• Q4 2024 comprehensive loss of US$ 66.6 million vs gain of US$ 112.3 million in Q4 2023

Insights

Financial Analyst

The Q4 2024 results demonstrate Vesta's exceptional execution in both operational and financial dimensions. The company's 17.7% revenue growth to $252.3 million significantly exceeded guidance, while maintaining premium margins with 94.6% Adjusted NOI and 83.5% Adjusted EBITDA. This performance reflects strong pricing power and operational efficiency in a robust Mexican industrial real estate market.

The leasing metrics reveal compelling market dynamics, with 7.7 million square feet of total leasing activity and an impressive 8.4% lease spread on renewals. This pricing power, combined with 93.4% portfolio occupancy, indicates strong tenant demand and Vesta's strategic positioning in key industrial corridors. The six-year average weighted lease term provides excellent cash flow visibility and reduces near-term market risk.

Vesta's capital deployment strategy shows disciplined growth, with 2.8 million square feet under construction at a projected 10.9% yield on cost. The new $545 million sustainable credit facility enhances financial flexibility while potentially reducing borrowing costs through ESG-linked pricing. The strategic land acquisitions in Guadalajara and Ciudad Juarez position Vesta to capture increasing nearshoring demand.

The company's commitment to shareholder returns is evident through the $42.3 million share repurchase program and consistent dividend payments. The balance between growth investments and capital return demonstrates mature capital allocation discipline. The AA MSCI ESG rating and inclusion in sustainability indices reflect strong governance and risk management practices that can translate into lower cost of capital and premium valuations.

MEXICO CITY--(BUSINESS WIRE)-- Corporación Inmobiliaria Vesta S.A.B. de C.V., (“Vesta”, or the “Company”) (BMV: VESTA; NYSE: VTMX), a leading industrial real estate company in Mexico, today announced results for the fourth quarter ended December 31, 2024. All figures included herein were prepared in accordance with International Financial Reporting Standards (IFRS), which differs in certain significant respects from U.S. GAAP. This information should be read in conjunction with, and is qualified in its entirety by reference to, our consolidated financial statements, including the notes thereto. Vesta’s financial results are stated in US dollars unless otherwise noted.

Q4 2024 Highlights

• Vesta delivered strong financial results for the full year 2024, achieving US$ 252.3 million in total income; a 17.7% year over year increase which exceeded the 17% upper range of Vesta's revised revenue guidance. 2024 Adjusted NOI¹ margin reached 94.6%, also exceeding revised guidance of 94.5%, while Adjusted EBITDA² margin reached 83.5% in line with the 83.5% revised guidance. Vesta FFO ended 2024 at US$ 160.1 million; a 25.2% increase compared to US$ 127.9 million in 2023.
• Vesta achieved strong leasing activity in 2024, reaching a total of 7.7 million sf; 3.5 million sf in new leases and 4.2 million in lease renewals, with a six-year average weighted lease life.
• Fourth quarter 2024 leasing activity reached 1.6 million sf: 739 thousand sf in new contracts, most in the Bajio Region with premier global companies in the electronics, automotive and logistics sectors, and 813 thousand sf in lease renewals. Vesta’s fourth quarter 2024 total portfolio occupancy therefore reached 93.4%, while stabilized and same-store occupancy reached 95.5% and 97.6%, respectively.
• 2024 renewals and re-leasing reached 4.7 million sf with a trailing twelve-month weighted average spread of 8.4%. Same-store NOI increased by 4.2% year on year.
• During the quarter, the Company acquired 36.3 acres of land in Guadalajara adjacent to the Vesta Park Guadalajara. This strategic acquisition enables Vesta to build approximately 700,000 sf of GLA, utilizing the Park's existing infrastructure. We also sold a small piece of land in the Bajio, in line with our asset recycling program.
• New construction totaled 2.6 million square feet in 2024, at an estimated 11.0% weighted average yield on cost. During the fourth quarter Vesta began construction on three new buildings in Querétaro totaling 560 thousand sf with an estimated total investment of US$ 33.7 million.
• Vesta’s current construction in progress reached 2.8 million sf by the end of the fourth quarter 2024, representing an estimated investment of approximately US$ 214.1 million and a 10.9% yield on cost, in markets including Mexico City, Puebla, Querétaro, Aguascalientes and Monterrey.
• The Company successfully closed a US$ 545 million Global Syndicated Sustainable Credit Facility during the fourth quarter 2024, comprised of a US$ 345 million term loan with an 18-month availability period and a US$ 200 million revolving credit facility, replacing the Company's prior US $200 million in-place undrawn Revolving Credit Facility.
• Vesta’s 2024 share repurchase program reached US$ 42.3 million, or 16.5 million shares, approximately 1.9% of total outstanding shares. The Company’s strategy remains focused on consistently allocating capital to ensure the most significant shareholder return.
• On January 15, 2025 Vesta paid US$ 16.2 million in dividends, equivalent to PS$ 0.3883 per ordinary share for the fourth quarter 2024.
• In 2024, Vesta launched its updated ESG Strategy aligned with the Company's Route 2030. The new strategy is led by four pillars: Governance and Integrity, Social, Environmental and Sustainable Business. The Company was also included within the S&P/BMV Total ESG Mexico Index in 2024, for the fifth consecutive year, and was included within the S&P Global Sustainability Yearbook for the third consecutive year. Further, Vesta has surpass its targets related to the sustainability-linked bond issued at the beginning of 2021, having ended 2024 with eleven new LEED certified buildings and 20 buildings with Edge Certification, as a result the Company has reached approximately 39% of certified GLA. Vesta is among the leading companies in the MSCI rating, having achieved AA rating for the second consecutive year.
• Subsequent to quarter's end, in January 2025, Vesta acquired 4.2 million sf of land in Ciudad Juarez, enabling the Company to build six new buildings comprised of 1.6 million sf, aligned with delivering on the Vesta Route 2030 growth strategy.

				12 months
Financial Indicators (million)	Q4 2024	Q4 2023	Chg. %	2024	2023	Chg. %
Total Rental Income	65.2	55.9	16.5	252.3	214.5	17.7
Total Revenues (-) Energy	63.3	54.0	17.1	244.8	212.5	15.2
Adjusted NOI	59.1	53.0	11.7	231.5	201.2	15.1
Adjusted NOI Margin %	93.5%	98.1%		94.6%	94.6%
Adjusted EBITDA	52.3	44.1	18.5	204.4	174.2	17.3
Adjusted EBITDA Margin %	82.7%	81.7%		83.5%	82.0%
EBITDA Per Share	0.0596	0.0520	14.6	0.2314	0.2266	2.1
Total Comprehensive Income	(66.6)	112.3	(159.4)	210.2	324.5	(35.2)
Vesta FFO	41.7	32.6	28.0	160.1	127.9	25.2
Vesta FFO Per Share	0.0476	0.0384	2390.0	0.1813	0.1664	890.0
Vesta FFO (-) Tax Expense	40.2	14.4	178.5	128.2	36.0	256.3
Vesta FFO (-) Tax Expense Per Share	0.0458	0.0170	169.5	0.1452	0.0468	210.1
Diluted EPS	(0.0760)	0.1323	(157.4)	0.2380	0.4221	(43.6)
Shares (average)	877.1	848.7	3.3	883.3	768.8	14.9

• Vesta’s fourth quarter 2024 total income was US$ 65.2 million; a 16.5% year over year increase. Fourth 2024 Adjusted NOI¹ margin and Adjusted EBITDA² margin reached 93.5% and 82.7%, respectively. Vesta FFO ended fourth quarter 2024 at US$ 41.7 million; a 28.0% increase compared to US$ 32.6 million in fourth 2023.
• Fourth quarter 2024 revenue reached US$ 65.2 million; a 16.5% year on year increase from US$ 55.9 million in the fourth quarter 2023 primarily due to US$ 6.4 million in new revenue-generating contracts and a US$ 2.2 million inflationary benefit on fourth quarter 2024 results.
• Fourth quarter 2024 Adjusted Net Operating Income (Adjusted NOI) increased 11.7% to US$ 59.1 million, compared to US$ 53.0 million in the fourth quarter 2023. The fourth quarter 2024 Adjusted NOI margin was 93.5%; a 460-basis-point year on year decrease due to increased costs related to rental income generating properties.
• Adjusted EBITDA for the quarter increased 18.5% to US$ 52.3 million, as compared to US$ 44.1 million in the fourth quarter 2023. The Adjusted EBITDA margin was 82.7%; a 100-basis-point increase primarily due to a decrease in administrative expenses during the quarter.
• Fourth quarter 2024 Vesta funds from operations after tax (Vesta FFO (-) Tax Expense) increased to a US$ 40.2 million gain, from US$ 14.4 million for the same period in 2023. Vesta FFO after tax per share was US$ 0.0458 for the fourth quarter 2024 compared with US$ 0.0170 for the same period in 2023, an This increase is due to higher income and a decrease in current taxes for the fourth quarter 2024. Fourth quarter 2024 Vesta FFO excluding current tax was US$ 41.7 million compared to US$ 32.6 million in the fourth quarter 2023, due to higher profit and lower interest expenses relative to the same period in 2023.
• Fourth quarter 2024 total comprehensive loss was US$ 66.6 million, versus a US$ 112.3 million gain in the fourth quarter 2023, primarily due to an increase in current taxes during the fourth quarter 2024.
• The total value of Vesta’s investment property portfolio was US$ 3.7 billion as of December 31, 2024; a 15.1% increase compared to US$ 3.2 billion at the end of December 31, 2023.

For a full version of Corporación Inmobiliaria Vesta Fourth Quarter 2024 Earnings Release, please visit: https://ir.vesta.com.mx/financial-results

CONFERENCE CALL INFORMATION

Conference Call

Wednesday, February 19, 2025
9:00 a.m. (Mexico City Time)
10:00 a.m. (Eastern Time)

To participate in the conference call please connect via webcast or by dialing:

International Toll-Free: +1 (888) 350-3870
International Toll: +1 (646) 960-0308
International Numbers: https://events.q4irportal.com/custom/access/2324/
Participant Code: 1849111

Webcast: https://events.q4inc.com/attendee/500867021

The replay will be available two hours after the call has ended and can be accessed from Vesta’s IR website.

About Vesta

Vesta is a real estate owner, developer and asset manager of industrial buildings and distribution centers in Mexico. As of December 31, 2024, Vesta owned 225 properties located in modern industrial parks in 16 states of Mexico totaling a GLA of 40.3 million sf (3.7 million m²). Vesta has several world-class clients participating in a variety of industries such as automotive, aerospace, retail, high-tech, pharmaceuticals, electronics, food and beverage and packaging. For additional information visit: www.vesta.com.mx.

Note on Forward-Looking Statements

This report may contain certain forward-looking statements and information relating to the Company and its expected future performance that reflects the current views and/or expectations of the Company and its management with respect to its performance, business and future events. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like “believe,” “anticipate,” “expect,” “envisages,” “will likely result,” or any other words or phrases of similar meaning. Such statements are subject to a number of risks, uncertainties and assumptions. Some of the factors that may affect outcomes and results include, but are not limited to: (i) national, regional and local economic and political climates; (ii) changes in global financial markets, interest rates and foreign currency exchange rates; (iii) increased or unanticipated competition for our properties; (iv) risks associated with acquisitions, dispositions and development of properties; (v) tax structuring and changes in income tax laws and rates; (vi) availability of financing and capital, the levels of debt that we maintain; (vii) environmental uncertainties, including risks of natural disasters; (viii) risks related to any potential health crisis and the measures that governments, agencies, law enforcement and/or health authorities implement to address such crisis; and (ix) those additional factors discussed in reports filed with the Bolsa Mexicana de Valores and in the U.S. Securities and Exchange Commission. We caution you that these important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in this presentation and in oral statements made by authorized officers of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to update or revise any forward-looking statements, including any financial guidance, whether as a result of new information, future events or otherwise except as may be required by law.

______________________________________________
1	Adjusted NOI and Adjusted NOI Margin calculations have been modified, please refer to Notes and Disclaimers.
2	Adjusted EBITDA and Adjusted EBITDA Margin calculations have been modified, please refer to Notes and Disclaimers

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250218872088/en/

Juan Sottil

CFO

+52 55 5950-0070 ext. 133

jsottil@vesta.com.mx

Fernanda Bettinger

IRO

+52 55 5950-0070 ext. 163

mfbettinger@vesta.com.mx

investor.relations@vesta.com.mx

Barbara Cano

InspIR Group

+1 (646) 452-2334

barbara@inspirgroup.com

Source: Corporación Inmobiliaria Vesta S.A.B. de C.V.

FAQ

What was VTMX's total revenue growth in 2024?

Vesta's total income grew by 17.7% year-over-year to US$ 252.3 million in 2024, exceeding the company's revised guidance of 17%.

How much new leasing activity did VTMX achieve in Q4 2024?

VTMX achieved 1.6 million sf of leasing activity in Q4 2024, consisting of 739,000 sf in new contracts and 813,000 sf in lease renewals.

What was VTMX's FFO performance in 2024?

Vesta FFO reached US$ 160.1 million in 2024, representing a 25.2% increase compared to US$ 127.9 million in 2023.

How much did VTMX spend on share repurchases in 2024?

VTMX spent US$ 42.3 million on share repurchases in 2024, buying back 16.5 million shares, approximately 1.9% of total outstanding shares.

What was VTMX's portfolio occupancy rate in Q4 2024?

VTMX's total portfolio occupancy reached 93.4% in Q4 2024, with stabilized occupancy at 95.5% and same-store occupancy at 97.6%.