We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Kimco (KIM) Beats Q1 FFO & Revenue Estimates, Revises Outlook
Read MoreHide Full Article
Kimco Realty Corp. (KIM - Free Report) reported first-quarter 2024 funds from operations (FFO) per share of 39 cents, which beat the Zacks Consensus Estimate of 38 cents. The figure was in line with the year-ago quarter’s tally.
Though Kimco reported growth in revenues, a rise in interest expenses acted as a dampener.
This retail REIT clocked in revenues of $503.8 million, which topped the consensus mark of $468.8 million. Moreover, the figure improved 13.7% year over year.
According to Conor Flynn, the CEO of Kimco, "Our first quarter results surpassed our initial expectations and showcase the robust demand that continues to permeate our open-air, grocery-anchored shopping center portfolio, supported by the exceptional performance of our dedicated team of associates." Flynn also stated, “we achieved four million square feet of leasing with double-digit rent spreads and strong growth in same property NOI.”
Quarter in Detail
Pro-rata portfolio occupancy at the end of the first quarter was 96%, reflecting an expansion of 20 basis points (bps) year over year but down 20 bps sequentially. The acquisition of RPT and the vacating of four Rite Aid leases had lowered occupancy by 14 basis points and 10 basis points, respectively.
Pro-rata anchor occupancy ended the quarter at 97.8%, unchanged year over year and down 20 bps from the previous quarter. Pro-rata small shop occupancy ended the quarter at 91.5%, representing an uptick of 80 basis points year over year but down 20 bps sequentially.
Kimco executed 583 leases, aggregating 4.0 million square feet in the quarter. Blended pro-rata rent spreads on comparable spaces generated was 10.2%, with pro-rata cash rent spreads for new leases climbing 35.5%, and renewals and options rising 7.8%.
Same-property net operating income (NOI) grew 3.9% year over year to $381.3 million, backed by a rise in the minimum rent of 2.8%. Interest expenses were up 21.6% year over year to $74.6 million in the reported quarter.
Portfolio Activity
During the quarter, Kimco completed the $2.3 billion acquisition of RPT Realty. It disposed of 10 former RPT properties for an aggregate price of $248 million. This resulted in the company achieving its 2024 disposition target for former RPT properties.
Balance Sheet Position
This retail REIT exited the first quarter of 2024 with $2.0 billion of immediate liquidity. This included $1.9 billion available on its $2.0 billion unsecured revolving credit facility and more than $135 million of cash and cash equivalents.
Its net-debt-to-EBITDA was 5.6X on a look-through basis as of Mar 31, 2024, down from 6.2X witnessed in the prior-year quarter.
During the first quarter, Kimco sold the remaining 14.2 million shares of Albertsons Companies, Inc. (ACI - Free Report) at a price of $21.05 per share, resulting in $299.1 million of proceeds. Kimco recorded a provision for income taxes of $71.8 million on the taxable gain from the sale of the shares during the first quarter.
Dividend Update
Concurrent with the first-quarter earnings release, Kimco’s board of directors declared a quarterly cash dividend of 24 cents per share. This dividend will be paid out on Jun 20 to its shareholders of record as of Jun 6, 2024.
2024 Guidance
For 2024, Kimco revised its FFO per share projection to the $1.56-$1.60 range from the $1.54-$1.58 range projected earlier. The Zacks Consensus Estimate for the same is currently pegged at $1.58.
Kimco expects 2024 same property NOI growth of 2.25-3% compared with 1.5-2.5% (including RPT) guided earlier, and total acquisitions and structured investments are expected between $300 million and $350 million.
Kimco currently carries a Zacks Rank #4 (Sell).
Kimco Realty Corporation Price, Consensus and EPS Surprise
We now look forward to the earnings releases of other retail REITs like Simon Property Group, Inc. (SPG - Free Report) and Realty Income (O - Free Report) , both of which are slated to report on May 6.
The Zacks Consensus Estimate for Simon Property Group’s first-quarter 2024 FFO per share is pegged at $2.80, which suggests a year-over-year increase of 2.19%. SPG currently carries a Zacks Rank #4.
The Zacks Consensus Estimate for Realty Income’s first-quarter 2024 FFO per share is pegged at $1.03, which implies a year-over-year increase of 5.1%. O currently carries a Zacks Rank #4.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Kimco (KIM) Beats Q1 FFO & Revenue Estimates, Revises Outlook
Kimco Realty Corp. (KIM - Free Report) reported first-quarter 2024 funds from operations (FFO) per share of 39 cents, which beat the Zacks Consensus Estimate of 38 cents. The figure was in line with the year-ago quarter’s tally.
Though Kimco reported growth in revenues, a rise in interest expenses acted as a dampener.
This retail REIT clocked in revenues of $503.8 million, which topped the consensus mark of $468.8 million. Moreover, the figure improved 13.7% year over year.
According to Conor Flynn, the CEO of Kimco, "Our first quarter results surpassed our initial expectations and showcase the robust demand that continues to permeate our open-air, grocery-anchored shopping center portfolio, supported by the exceptional performance of our dedicated team of associates." Flynn also stated, “we achieved four million square feet of leasing with double-digit rent spreads and strong growth in same property NOI.”
Quarter in Detail
Pro-rata portfolio occupancy at the end of the first quarter was 96%, reflecting an expansion of 20 basis points (bps) year over year but down 20 bps sequentially. The acquisition of RPT and the vacating of four Rite Aid leases had lowered occupancy by 14 basis points and 10 basis points, respectively.
Pro-rata anchor occupancy ended the quarter at 97.8%, unchanged year over year and down 20 bps from the previous quarter. Pro-rata small shop occupancy ended the quarter at 91.5%, representing an uptick of 80 basis points year over year but down 20 bps sequentially.
Kimco executed 583 leases, aggregating 4.0 million square feet in the quarter. Blended pro-rata rent spreads on comparable spaces generated was 10.2%, with pro-rata cash rent spreads for new leases climbing 35.5%, and renewals and options rising 7.8%.
Same-property net operating income (NOI) grew 3.9% year over year to $381.3 million, backed by a rise in the minimum rent of 2.8%. Interest expenses were up 21.6% year over year to $74.6 million in the reported quarter.
Portfolio Activity
During the quarter, Kimco completed the $2.3 billion acquisition of RPT Realty. It disposed of 10 former RPT properties for an aggregate price of $248 million. This resulted in the company achieving its 2024 disposition target for former RPT properties.
Balance Sheet Position
This retail REIT exited the first quarter of 2024 with $2.0 billion of immediate liquidity. This included $1.9 billion available on its $2.0 billion unsecured revolving credit facility and more than $135 million of cash and cash equivalents.
Its net-debt-to-EBITDA was 5.6X on a look-through basis as of Mar 31, 2024, down from 6.2X witnessed in the prior-year quarter.
During the first quarter, Kimco sold the remaining 14.2 million shares of Albertsons Companies, Inc. (ACI - Free Report) at a price of $21.05 per share, resulting in $299.1 million of proceeds. Kimco recorded a provision for income taxes of $71.8 million on the taxable gain from the sale of the shares during the first quarter.
Dividend Update
Concurrent with the first-quarter earnings release, Kimco’s board of directors declared a quarterly cash dividend of 24 cents per share. This dividend will be paid out on Jun 20 to its shareholders of record as of Jun 6, 2024.
2024 Guidance
For 2024, Kimco revised its FFO per share projection to the $1.56-$1.60 range from the $1.54-$1.58 range projected earlier. The Zacks Consensus Estimate for the same is currently pegged at $1.58.
Kimco expects 2024 same property NOI growth of 2.25-3% compared with 1.5-2.5% (including RPT) guided earlier, and total acquisitions and structured investments are expected between $300 million and $350 million.
Kimco currently carries a Zacks Rank #4 (Sell).
Kimco Realty Corporation Price, Consensus and EPS Surprise
Kimco Realty Corporation price-consensus-eps-surprise-chart | Kimco Realty Corporation Quote
Upcoming Earnings Releases
We now look forward to the earnings releases of other retail REITs like Simon Property Group, Inc. (SPG - Free Report) and Realty Income (O - Free Report) , both of which are slated to report on May 6.
The Zacks Consensus Estimate for Simon Property Group’s first-quarter 2024 FFO per share is pegged at $2.80, which suggests a year-over-year increase of 2.19%. SPG currently carries a Zacks Rank #4.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Realty Income’s first-quarter 2024 FFO per share is pegged at $1.03, which implies a year-over-year increase of 5.1%. O currently carries a Zacks Rank #4.
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.