Nexus Industrial REIT (NXR-UN) Q1 2026 earnings summary

Executive summary

• Net operating income for Q1 was CAD 33.8 million, up 5.4% year-over-year, driven by completed developments and acquisitions despite property dispositions.

• Net income for Q1 2026 was CAD 32.2 million, down CAD 1 million year-over-year due to lower fair value adjustments and higher expenses, partially offset by higher NOI and derivative gains.

• Normalized AFFO payout ratio improved to 96.6%, a 7.5% decrease from the prior year, moving closer to the target of below 100% for 2026.

• Achieved investment-grade credit rating (BBB low, stable) and completed inaugural CAD 500 million bond issuance in April, enhancing financial flexibility.

• Strategic asset sales and development progress contributed to financial flexibility and future growth.

Financial highlights

• Property revenues increased to CAD 46.0 million from CAD 44.8 million year-over-year.

• NOI increased by CAD 1.7 million year-over-year, driven by new developments, acquisitions, and lease termination income.

• Normalized AFFO per unit was CAD 0.162, up from CAD 0.154 last year, with higher NOI offset by increased interest and G&A expenses.

• NAV per unit increased by CAD 0.07 from December 31, 2025, to CAD 13.29.

• Adjusted EBITDA for the last 12 months reached CAD 121.3 million, nearly flat year-over-year.

Outlook and guidance

• Expects mid-single digit industrial same property NOI growth for 2026, driven by lease-up of vacant space and positive rent spreads.

• Normalized AFFO payout ratio anticipated to average below 100% for the year, supporting sustainable distributions.

• Growth in the remainder of the year expected from leasing vacant space, new rent from asset sales, and continued development completions.

• Guidance excludes lease termination fee income from SPNOI calculations.

• Benefits expected from recent developments and acquisitions, including major projects in St. Thomas, Calgary, and Montreal/Longueuil.