LOG Commercial Properties e Participações (LOGG3) Q2 2024 earnings summary

Executive summary

• Achieved record quarterly production of up to 115,000 sqm GLA, supporting a new annual production level of 500,000 sqm GLA and reflecting strong operational execution.

• Net income reached BRL 92 million in Q2 2024, up 109% year-over-year, and consolidated net income for 1H24 was R$147.2 million, more than doubling year-over-year, driven by fair value gains and asset sales.

• Delivered over 63,000 sqm GLA in three projects with a pre-lease rate of 79%, indicating robust demand for logistics warehouses.

• Advanced asset recycling, selling BRL 764 million in assets this quarter and BRL 2.4 billion over 24 months, at or above NAV, with major sales including LOG Via Expressa and LOG Salvador.

• Cancelled 9.5 million shares (9.3% of capital stock) and continued aggressive share buyback, reflecting confidence in NAV, which is 42% above market value.

Financial highlights

• Net revenue was BRL 53 million in Q2 2024, down year-over-year due to asset sales; excluding sales, gross revenue would have grown 31%.

• EBITDA doubled to BRL 141 million in Q2 2024, with a margin of 263.8%, and benefited from R$184.1 million in fair value gains in 1H24.

• Operating expenses improved by up to 39.3% year-over-year, driven by lower tax impacts from asset sales and G&A efficiency.

• Adjusted net debt was BRL 531 million, down 24% year-over-year; leverage improved to 1.49x.

• Cash and cash equivalents plus marketable securities at June 30, 2024, were R$889.6 million.

Outlook and guidance

• Expects robust revenue growth of 20–25% annually from 2024 to 2028, driven by new deliveries and strong market demand.

• LOG 2 Million Plan deliveries to begin in 2025 and conclude in 2028, targeting a 70% net portfolio growth.

• Capex for 2024 expected between R$800 million and R$900 million.

• Ongoing expansion plans with continued assessment of financial markets for funding opportunities.

• Anticipates continued strong pre-leasing, especially from e-commerce and Chinese platforms.