Saul Centers (BFS) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 increased to $19.5 million from $17.2 million year-over-year, with total revenue up 5.1% to $66.9 million and expenses up 2.4% to $47.6 million.

• For the six months ended June 30, 2024, net income rose to $37.8 million from $34.9 million, and total revenue increased 5.4% to $133.6 million.

• Same property revenue and operating income grew 5.1% and 4.4% respectively for the quarter and six-month period, driven by higher termination fees, base rent, and expense recoveries.

• Net income available to common stockholders for Q2 2024 was $11.6 million, or $0.48 per share, up from $10.4 million, or $0.43 per share.

Financial highlights

• Q2 2024 base rent increased by $1.1 million (2.0%) and expense recoveries by $0.8 million (8.5%) year-over-year.

• Other revenue rose $1.5 million (90.3%) in Q2, mainly from higher lease termination fees.

• Funds From Operations (FFO) for Q2 was $28.5 million, up 7.6% year-over-year; FFO per diluted share was $0.83.

• FFO for the six months ended June 30, 2024, was $56.0 million ($1.63 per share), up from $53.4 million ($1.60 per share) year-over-year.

• Commercial portfolio was 95.8% leased and residential portfolio 99.4% leased as of June 30, 2024.

Outlook and guidance

• Initial delivery of Twinbrook Quarter Phase I is anticipated in late 2024; Hampden House construction is expected to complete in late 2025.

• Management expects continued focus on mixed-use development and pad site expansion, with a cautious approach to acquisitions due to limited market opportunities.