Postal Realty Trust (PSTL) Q3 2024 earnings summary

Executive summary

• Portfolio expanded to 1,653 properties across 49 states and Puerto Rico, primarily leased to USPS, with 99.6% occupancy and a weighted average lease term of ~3 years; 134 properties acquired for $61.4 million year-to-date.

• Achieved progress on re-leasing, improving visibility on same-store cash NOI, and executed the first significant property disposition after quarter-end.

• Revenue grew 22% year-over-year in Q3 2024, driven by acquisitions and new lease terms with USPS; rental income up 21.6% for the quarter.

• Net income for Q3 2024 was $1.1 million ($0.03 per share), down from $1.2 million in Q3 2023.

• Declared and paid $0.24 per share quarterly dividend, totaling $0.72 per share year-to-date, with consistent annual increases since IPO.

Financial highlights

• Q3 2024 revenues: $19.7 million, up 22.1% year-over-year; nine-month revenues: $55.0 million, up 17.8%.

• FFO: $7.1 million ($0.24 per share); AFFO: $8.8 million ($0.30 per share).

• Net Debt to annualized Adjusted EBITDA improved to 5.6x.

• Operating expenses rose 21.2% in Q3, mainly due to property acquisitions.

• Dividend payout ratio: 3x quarterly EPS.

Outlook and guidance

• 2023 same-store cash NOI growth expected to exceed 4%; 2024 projected at least 3.25%; 2025 at least 3%.

• 2024 acquisition target reaffirmed at $90 million at or above a 7.5% cap rate.

• 29 properties under contract for $10.6 million and 13 properties acquired post-quarter for $4.2 million.

• Full-year 2024 cash G&A expense guidance remains $9.5–$9.8 million.

• Management expects further revenue growth from acquisitions and ongoing lease renewals.