Alexander & Baldwin (ALEX) Q2 2024 earnings summary

Executive summary

• Net income available to shareholders was $9.1 million ($0.13 per diluted share) for Q2 2024, down from $13.3 million year-over-year, with FFO of $20.6 million ($0.28 per share) and Adjusted FFO of $16.9 million ($0.23 per share); focus remained on operational excellence, portfolio growth, and cost streamlining.

• Completed sale of 81 acres of non-core land for $10.5 million, generating a $5.2 million margin and supporting cost structure improvements.

• Executed 47 leases with blended spreads of 7.3% and maintained a positive leasing outlook in Hawaii.

• Streamlined business and cost structure, with G&A expenses down 26.8% to $7.3 million and continued preconstruction at Maui Business Park and five photovoltaic projects underway.

• 2024 guidance was raised based on year-to-date performance and improved outlook.

Financial highlights

• Net income for Q2 2024 was $9.1 million ($0.13 per diluted share), down from $13.3 million year-over-year; income from continuing operations was $11.7 million ($0.16 per diluted share), up 8% year-over-year.

• FFO for Q2 2024 was $20.6 million ($0.28 per share), up from $19.8 million ($0.27 per share) last year; Adjusted FFO was $16.9 million ($0.23 per share), down from $18 million ($0.25 per share) due to higher maintenance Capex.

• G&A expenses decreased by 26.8% to $7.3 million, reflecting cost reductions.

• Operating revenue for Q2 2024 was $51.0 million, down 3.9% year-over-year, mainly due to lower land sales.

• Operating cash flow from continuing operations for the first half of 2024 was $39.6 million, up from $37.9 million in 2023.

Outlook and guidance

• Raised 2024 same-store NOI growth guidance to 1.25%-2.25%; excluding prior year reserve collections, guidance is 2.1%-3.1%.

• Increased 2024 total company FFO guidance to $1.17-$1.26 per share, with CRE/corporate FFO at $1.04-$1.08 per share.

• Land operations FFO guidance raised to $0.13-$0.18 per share, reflecting recent land sale.

• 2024 AFFO guidance raised to $0.99-$1.08 per share.

• Management expects sufficient liquidity from operating cash flows, cash on hand, and credit facilities to meet business needs.