Farmland Partners (FPI) Q2 2024 earnings summary

Executive summary

• Q2 2024 net loss was $2.1 million ($0.06/share), compared to net income of $7.9 million in Q2 2023, mainly due to lower rental income, a $1.4 million one-time severance expense, and the absence of large asset sale gains from last year.

• AFFO improved to $0.5 million ($0.01/share), up from negative $1.1 million in Q2 2023, benefiting from forfeited deposits, cost controls, and higher citrus sales.

• Operating revenues declined 1.2% year-over-year to $11.4 million, while operating expenses fell 7% to $8.2 million.

• The company disposed of 10.4% of its portfolio, yet core performance remained robust, reflecting effective portfolio management.

• CFO transition from James Gilligan to Susan Landi was part of cost-cutting and leadership changes.

Financial highlights

• Q2 2024 total operating revenues were $11.4 million, down from $11.6 million in Q2 2023.

• Net loss attributable to common stockholders was $2.8 million for Q2 2024, or $(0.06) per share, versus net income of $7.0 million, or $0.14 per share, in Q2 2023.

• Six-month 2024 net loss was $0.6 million, compared to net income of $9.6 million in the prior year period; six-month AFFO was $3.3 million ($0.07/share), higher than 2023.

• Adjusted EBITDAre rose 20.8% to $6.5 million for the quarter; NOI increased 7.8% to $18.5 million for the six months ended June 30, 2024.

• Cash and cash equivalents at June 30, 2024, were $5.7 million, down from $11.2 million a year earlier.

Outlook and guidance

• 2024 AFFO guidance is $9.8M–$12.8M ($0.20–$0.26/share), with the low end slightly higher than last quarter’s outlook.

• Management expects continued strong demand for quality farmland, near-zero vacancy rates, and stable or appreciating land values.

• G&A is expected to rise from severance but offset by targeted cost reductions.

• Rent renewals for 2024 are expected to increase 5–10%, lower than the 15–20% increases of recent years, reflecting a higher base and softer commodity prices.

• Further asset disposals are being evaluated to fund debt or preferred equity reductions and stock buybacks.