The Hamilton Company (NEN) Q2 2024 earnings summary

Executive summary

• Revenue for Q2 2024 increased 10.8% year-over-year, with net income up 83.1% to $4.1 million for the quarter and 89.4% to $7.5 million for the six months ended June 30, 2024.

• Residential vacancy rate improved to 1.5% as of August 1, 2024, compared to 1.8% a year earlier.

• The partnership completed significant property acquisitions and continued development of the Mill Street project, with $4.2 million spent on construction in H1 2024.

Financial highlights

• Rental income rose 10.4% in Q2 2024 to $19.8 million and 11.3% for the six months to $39.6 million.

• Operating expenses increased 1.1% in Q2 and 4.0% for the six months, with administrative expenses down 24.9% in Q2.

• Net income per unit was $34.77 for Q2 2024 and $64.28 for the six months, up from $18.73 and $33.45, respectively, year-over-year.

• Interest expense remained stable at $3.9 million for Q2 and $7.8 million for the six months.

• Share of net income from joint ventures increased 168.5% in Q2 and 119.5% for the six months.

Outlook and guidance

• Management expects continued rent growth for the remainder of 2024, supported by strong renewal and new lease increases (6.4% and 7.6% in Q2, respectively).

• Construction of the Mill Street Development is expected to require $30 million through 2025, with completion anticipated in Q4 2025.

• Cash from operations is expected to be sufficient to fund operations, distributions, and debt payments.