Kennedy-Wilson (KW) Q4 2023 earnings summary

Executive summary

• FY 2023 Baseline EBITDA grew 8% as the investment-management platform expanded 42%; reported results included $439 million of primarily non-cash items, mainly unrealized co-investment valuation declines.

• Real Estate AUM was $25 billion and fee-bearing capital reached a record $8.4 billion at year-end, up 42% YoY; strategic partners contributed $5.2 billion of incremental non-discretionary capital.

• Portfolio overview included 37,600 multifamily units and 25 million commercial sq ft; stabilized portfolio NOI was $491.9 million across 447 investments, at 94.0% occupancy.

Financial highlights

• FY 2023 revenue was $562.6 million vs. $540.0 million in 2022; Q4 revenue was $140.1 million vs. $139.6 million.

• FY 2023 GAAP net loss attributable to common shareholders was $341.8 million, or $2.46 per diluted share, vs. net income of $64.8 million, or $0.47 per diluted share, in 2022.

• Q4 GAAP net loss was $247.8 million, or $1.78 per diluted share, vs. net income of $22.6 million, or $0.16 per diluted share, in Q4 2022.

• FY adjusted EBITDA was $189.8 million vs. $591.5 million in 2022; Q4 was negative $129.4 million vs. $147.1 million in Q4 2022.

• FY adjusted net loss was $151.3 million vs. adjusted net income of $264.9 million in 2022; Q4 adjusted net loss was $195.9 million vs. adjusted net income of $69.4 million.

Outlook and guidance

• Development and lease-up assets are expected to add $91 million of estimated annual NOI; multifamily development pipeline totals 3,800 units and $43 million of estimated annual NOI at stabilization by YE 2025.

• Dublin developments are expected to deliver 990 stabilized units and $13 million of annual NOI; 758 completed units were 54% leased as of February 20, 2024.

• U.S. market-rate projects include 1,230 units expected to complete construction by YE 2024, with ~$22 million of annual NOI at stabilization; 55% of 563 delivered units were leased.

• The 18-month asset-recycling plan targets $50–$750 million in cash from non-core sales; annual overhead reductions target $15–$20 million.