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Kimco Realty (KIM) Misses Q4 FFO Mark Despite Revenue Beat
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Kimco Realty Corp.’s (KIM - Free Report) fourth-quarter 2022 funds from operations (FFO) per share came in at 38 cents, missing the Zacks Consensus Estimate of 39 cents. The figure also compares unfavorably with the year-ago quarter’s 39 cents.
Though Kimco reported growth in revenues, a rise in interest expenses acted as a dampener. This retail REIT provided an initial outlook for 2023, which is below the consensus mark.
This retail REIT clocked in revenues of $439.8 million, beating the consensus mark of $435.2 million. Quarterly revenues increased 3.6% year over year.
For the full-year 2022, Kimco’s FFO per share came in at $1.58, higher than the prior-year tally of $1.38 and in line with the Zacks Consensus Estimate. This was backed by 26.6% growth in revenues to $1.73 billion.
Quarter in Detail
Pro-rata portfolio occupancy at the end of the fourth quarter was 95.7%, reflecting an expansion of 130 basis points (bps) year over year and 40 bps sequentially. Pro-rata anchor occupancy was 98.0%, up 90 bps year over year and 20 bps from the previous quarter. Pro-rata small-shop occupancy ended the quarter at 90.0%, representing an uptick of 230 bps from the prior-year quarter and 80 bps from the prior quarter.
The company signed 492 leases aggregating 2.5 million square feet in the quarter. Kimco generated blended pro-rata rent spreads on comparable spaces of 8.7%, with rental rates for new leases up 30.4%, and renewals and options rising 4.6%.
Same-property net operating income (NOI) increased 1.9% year over year, backed by a rise of 3.9% in the minimum rent. Interest expenses were up 6% year over year to $60.9 million in the reported quarter.
Portfolio Activity
In the reported quarter, Kimco acquired a grocery-anchored portfolio of eight Long Island, NY shopping centers in infill, high barrier to entry markets encompassing 540,000 square feet of space for $375.8 million. Moreover, Kimco acquired three land interests for $12.5 million.
During the quarter, Kimco sold two shopping centers and four land parcels aggregating 439,000 square feet for $41.9 million. Kimco’s pro-rata share of the sales price was $27.9 million.
Balance Sheet Position
This retail REIT exited 2022 with more than $2.1 billion of immediate liquidity. This included full availability under its $2-billion unsecured revolving credit facility and cash and cash equivalents of $150 million. Kimco generated proceeds of $301.1 million from the sale of 11.5 million shares of Albertsons Companies, Inc. (ACI - Free Report) common stock.
Following the quarter end, Kimco received $194.1 million as a special dividend payment from ACI related to the remaining 28.3 million ACI shares owned. Its net-debt-to-EBITDA on a look-through basis was 6.4X at the end of the fourth quarter, slightly up from 6.3X year over year.
Dividend Update
Concurrent with the fourth-quarter earnings release, Kimco’s board of directors declared a quarterly cash dividend of 23 cents per share. This dividend will be paid out on Mar 23 to its shareholders on record as of Mar 9, 2023.
2023 Guidance
For 2023, Kimco projects FFO per share in the range of $1.53-$1.57. This is lower than the current Zacks Consensus Estimate of $1.59.
Kimco’s 2023 projection is based on the assumption of same property NOI growth of 1.0-2.0% and total property acquisitions (including structured investments), net of dispositions, of $100 million. Also, it assumes monetization of roughly $300 million of ACI shares.
Simon Property Group, Inc.’s (SPG - Free Report) fourth-quarter 2022 comparable FFO per share of $3.15 beat the Zacks Consensus Estimate of $3.14. The figure compared favorably with the year-ago quarter’s $3.11. Simon Property’s performance was backed by a better-than-expected top line. Results reflected a healthy operating performance and growth in occupancy levels.
Federal Realty Investment Trust’s (FRT - Free Report) fourth-quarter 2022 FFO per share of $1.58 topped the Zacks Consensus Estimate of $1.57. This also compared favorably with the year-ago quarter’s tally of $1.47. Federal Realty’s results reflected healthy leasing activity and better-than-anticipated revenues. This retail REIT provided an upbeat outlook for 2023, with the FFO per share projection exceeding the consensus mark.
Upcoming Release
We now look forward to the earnings release of another retail REIT — Regency Centers Corporation (REG - Free Report) . Regency Centers Corporation is scheduled to release its earnings results today after the closing bell.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Kimco Realty (KIM) Misses Q4 FFO Mark Despite Revenue Beat
Kimco Realty Corp.’s (KIM - Free Report) fourth-quarter 2022 funds from operations (FFO) per share came in at 38 cents, missing the Zacks Consensus Estimate of 39 cents. The figure also compares unfavorably with the year-ago quarter’s 39 cents.
Though Kimco reported growth in revenues, a rise in interest expenses acted as a dampener. This retail REIT provided an initial outlook for 2023, which is below the consensus mark.
This retail REIT clocked in revenues of $439.8 million, beating the consensus mark of $435.2 million. Quarterly revenues increased 3.6% year over year.
For the full-year 2022, Kimco’s FFO per share came in at $1.58, higher than the prior-year tally of $1.38 and in line with the Zacks Consensus Estimate. This was backed by 26.6% growth in revenues to $1.73 billion.
Quarter in Detail
Pro-rata portfolio occupancy at the end of the fourth quarter was 95.7%, reflecting an expansion of 130 basis points (bps) year over year and 40 bps sequentially. Pro-rata anchor occupancy was 98.0%, up 90 bps year over year and 20 bps from the previous quarter. Pro-rata small-shop occupancy ended the quarter at 90.0%, representing an uptick of 230 bps from the prior-year quarter and 80 bps from the prior quarter.
The company signed 492 leases aggregating 2.5 million square feet in the quarter. Kimco generated blended pro-rata rent spreads on comparable spaces of 8.7%, with rental rates for new leases up 30.4%, and renewals and options rising 4.6%.
Same-property net operating income (NOI) increased 1.9% year over year, backed by a rise of 3.9% in the minimum rent. Interest expenses were up 6% year over year to $60.9 million in the reported quarter.
Portfolio Activity
In the reported quarter, Kimco acquired a grocery-anchored portfolio of eight Long Island, NY shopping centers in infill, high barrier to entry markets encompassing 540,000 square feet of space for $375.8 million. Moreover, Kimco acquired three land interests for $12.5 million.
During the quarter, Kimco sold two shopping centers and four land parcels aggregating 439,000 square feet for $41.9 million. Kimco’s pro-rata share of the sales price was $27.9 million.
Balance Sheet Position
This retail REIT exited 2022 with more than $2.1 billion of immediate liquidity. This included full availability under its $2-billion unsecured revolving credit facility and cash and cash equivalents of $150 million. Kimco generated proceeds of $301.1 million from the sale of 11.5 million shares of Albertsons Companies, Inc. (ACI - Free Report) common stock.
Following the quarter end, Kimco received $194.1 million as a special dividend payment from ACI related to the remaining 28.3 million ACI shares owned. Its net-debt-to-EBITDA on a look-through basis was 6.4X at the end of the fourth quarter, slightly up from 6.3X year over year.
Dividend Update
Concurrent with the fourth-quarter earnings release, Kimco’s board of directors declared a quarterly cash dividend of 23 cents per share. This dividend will be paid out on Mar 23 to its shareholders on record as of Mar 9, 2023.
2023 Guidance
For 2023, Kimco projects FFO per share in the range of $1.53-$1.57. This is lower than the current Zacks Consensus Estimate of $1.59.
Kimco’s 2023 projection is based on the assumption of same property NOI growth of 1.0-2.0% and total property acquisitions (including structured investments), net of dispositions, of $100 million. Also, it assumes monetization of roughly $300 million of ACI shares.
Kimco currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Kimco Realty Corporation Price, Consensus and EPS Surprise
Kimco Realty Corporation price-consensus-eps-surprise-chart | Kimco Realty Corporation Quote
Performance of Other Retail REITs
Simon Property Group, Inc.’s (SPG - Free Report) fourth-quarter 2022 comparable FFO per share of $3.15 beat the Zacks Consensus Estimate of $3.14. The figure compared favorably with the year-ago quarter’s $3.11. Simon Property’s performance was backed by a better-than-expected top line. Results reflected a healthy operating performance and growth in occupancy levels.
Federal Realty Investment Trust’s (FRT - Free Report) fourth-quarter 2022 FFO per share of $1.58 topped the Zacks Consensus Estimate of $1.57. This also compared favorably with the year-ago quarter’s tally of $1.47. Federal Realty’s results reflected healthy leasing activity and better-than-anticipated revenues. This retail REIT provided an upbeat outlook for 2023, with the FFO per share projection exceeding the consensus mark.
Upcoming Release
We now look forward to the earnings release of another retail REIT — Regency Centers Corporation (REG - Free Report) . Regency Centers Corporation is scheduled to release its earnings results today after the closing bell.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.