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FRP Holdings, Inc. (NASDAQ: FRPH) Announces Results for the Third Quarter and Nine Months Ended September 30, 2023

FRP Holdings, Inc.
FRP Holdings, Inc.

JACKSONVILLE, Fla., Nov. 08, 2023 (GLOBE NEWSWIRE) -- FRP Holdings, Inc. (NASDAQ-FRPH) –

Third Quarter Operational Highlights (compared to the same quarter last year)

  • 29.5% increase in pro-rata NOI ($8.09 million vs $6.24 million)

  • Mining royalty revenue increased 24.7%; 19.2% increase in royalties per ton

  • 54.2% increase in Asset Management revenue; 58.2% increase in Asset Management NOI

Third Quarter Consolidated Results of Operations

Net income for the third quarter of 2023 was $1,259,000 or $.13 per share versus $480,000 or $.05 per share in the same period last year. The third quarter of 2023 was impacted by the following items:

  • Operating profit increased $1,047,000 compared to the same quarter last year due to improved revenues in all four segments.

  • Interest income increased $1,512,000 due primarily to an increase in interest earned on cash equivalents ($1,118,000) and increased income from our lending ventures ($349,000).

  • Interest expense increased $378,000 compared to the same quarter last year due to less capitalized interest. We capitalized less interest because of fewer in-house and joint venture projects under development this quarter compared to last year.

  • Equity in loss of Joint Ventures increased $1,035,000 primarily due to increased losses during lease up at The Verge ($856,000).

Third Quarter Segment Operating Results

Asset Management Segment:

Total revenues in this segment were $1,442,000, up $507,000 or 54.2%, over the same period last year. Operating profit was $520,000, up $255,000 from $265,000 in the same quarter last year. Revenues and operating profit are up because of full occupancy at 1841 62nd Street (compared to 22.7% same period last year) and the addition of 1941 62nd Street to this segment in March 2023. We now have nine buildings in service at three different locations totaling 515,077 square feet of industrial and 33,708 square feet of office. At quarter end, we were 95.6% leased and 95.6% occupied. Net operating income in this segment was $1,096,000, up $403,000 or 58.2% compared to the same quarter last year.

Mining Royalty Lands Segment:

Total revenues in this segment were $3,082,000 versus $2,471,000 in the same period last year. Total operating profit in this segment was $2,509,000, an increase of $509,000 versus $2,000,000 in the same period last year. This increase is the result of increases in revenue at nearly every active location. Net Operating Income this quarter for this segment was $2,837,000, up $501,000 or 21.4% compared to the same quarter last year.

Development Segment:

With respect to ongoing projects:

  • We are the principal capital source of a residential development venture in Prince George’s County, Maryland known as “Amber Ridge.” Of the $18.5 million of committed capital to the project, $17.3 million in principal draws have taken place through quarter end. Through the end of September 30, 2023, 175 of the 187 units have been sold, and we have received 19.6 million in preferred interest and principal to date.

  • Bryant Street is a mixed-use joint venture between the Company and MRP in Washington, DC consisting of three apartment buildings with ground floor retail and one commercial building which is fully leased. At quarter end, Bryant Street’s 487 residential units were 94.5% leased and 94.5% occupied. Its commercial space was 95.9% leased and 79.1% occupied at quarter end.

  • Lease-up is underway at The Verge, and at quarter end, the building was 89.5% leased and 74.1% occupied inclusive of 25 units licensed to Placemaker Management for a short-term corporate rental program. Retail at this location is 45.2% leased.  This is our third mixed-use project in the Anacostia waterfront submarket in Washington, DC.

  • .408 Jackson is our second joint venture project in Greenville. Leasing began in the fourth quarter of 2022 with residential units 93.4% leased and 86.8% occupied at quarter end. Retail at this location is 100% leased and currently under construction and expected to open this winter.

  • Windlass Run, our suburban office and retail joint venture with St. John Properties, Inc. signed a new office lease for 2,752 square feet bringing the office portion of the project to 82.1% leased and 78.3% occupied.  Additional retail space at this site is 38.2% leased and 22.9% occupied.

  • This past quarter we broke ground on a new speculative warehouse project in Aberdeen, Maryland on Chelsea Road. This Class A, 259,200 square foot building due to be complete in the 3rd quarter of 2024.

Stabilized Joint Venture Segment:

Total revenues in this segment were $5,633,000, an increase of $157,000 versus $5,476,000 in the same period last year. The Maren’s revenue was $2,670,000, an increase of 2.4% and Dock 79 revenues increased $95,000 to $2,963,000 or 3.3%. Total operating profit in this segment was $840,000, a decrease of $66,000 versus $906,000 in the same period last year. During the quarter we experienced water damage to an elevator that resulted in a $100,000 insurance deductible expense. Pro-rata net operating income this quarter for this segment was $2,038,000, down $665,000 or 24.6% compared to the same quarter last year because of the sale of our 20% Tenancy-In-Common (TIC) interest in both properties to Steuart Investment Company (SIC), mitigated by $231,000 in pro-rata NOI from our share of the Riverside joint venture in Greenville, SC.

At the end of September, The Maren was 93.18% leased and 93.94% occupied. Average residential occupancy for the quarter was 95.57%, and 59.70% of expiring leases renewed with an average rent increase on renewals of 3.18%. The Maren is a joint venture between the Company and MRP and SIC, in which FRP Holdings, Inc. is the majority partner with 56.3% ownership.

Dock 79’s average residential occupancy for the quarter was 95.08%, and at the end of the quarter, Dock 79’s residential units were 93.44% leased and 95.74% occupied. This quarter, 71.43% of expiring leases renewed with an average rent increase on renewals of 2.30%. Dock 79 is a joint venture between the Company and MRP and SIC, in which FRP Holdings, Inc. is the majority partner with 52.8% ownership.

During the third quarter of 2022, we achieved stabilization at our Riverside Joint Venture in Greenville, South Carolina. At quarter end, the building was 94.5% leased with 91.5% occupancy. Average occupancy for the quarter was 92.92% with 52.83% of expiring leases renewing with an average rental increase of 8.55%. Riverside is a joint venture with Woodfield Development and the Company owns 40% of the venture.

Nine Months Operational Highlights (compared to the same period last year)

  • 26.2% increase in pro-rata NOI ($22.69 million vs $17.97 million)

  • Mining Royalties increased 23.8%; 13% increase in royalties per ton

  • 46.4% increase in Asset Management revenue; 46.2% increase in Asset Management NOI

Nine Months Consolidated Results of Operations

Net income for the first nine months of 2023 was $2,422,000 or $.26 per share versus $1,809,000 or $.19 per share in the same period last year. The first nine months of 2023 was impacted by the following items:

  • Operating profit increased $3,238,000 compared to the same period last year due to improved revenues and profits in all four segments.

  • Management company indirect increased $393,000 due to merit increases and new hires along with recruiting costs.

  • Interest income increased $5,001,000 due primarily to an increase in interest earned on cash equivalents ($3,637,000) and increased income from our lending ventures ($1,228,000).

  • Interest expense increased $1,036,000 compared to the same period last year due to less capitalized interest. We capitalized less interest because of fewer in-house and joint venture projects under development compared to last year.

  • Equity in loss of Joint Ventures increased $5,337,000 primarily due to increased losses during lease up at The Verge ($4,096,000) and .408 Jackson ($642,000).

  • The first nine months of 2022 included a $874,000 gain on sales of excess property at Brooksville.

Nine Months Segment Operating Results

Asset Management Segment:

Total revenues in this segment were $3,932,000, up $1,246,000 or 46.4%, over the same period last year. Operating profit was $1,225,000, up $618,000 from $607,000 in the same period last year. Revenues and operating profit are up partly because of rent growth at Cranberry Run, but primarily because of full occupancy at 1865 and 1841 62nd Street and the addition of 1941 62nd Street to this segment in March 2023. Net operating income in this segment was $2,726,000, up $862,000 or 46.2% compared to the same period last year.

Mining Royalty Lands Segment:

Total revenues in this segment were $9,628,000 versus $7,779,000 in the same period last year. Total operating profit in this segment was $8,031,000, an increase of $1,592,000 versus $6,439,000 in the same period last year. This increase is the result of the additional royalties from the acquisition in Astatula, Florida, which we completed at the beginning of the second quarter 2022, as well as increases in revenue at nearly every active location. Net Operating Income in this segment was $9,110,000, up $1,737,000 or 24% compared to the same period last year. As reported in a subsequent event note in the 10-Q from the quarter ended June 30, 2023, in August we received notification of an overpayment of $842,000 at a quarry where we share a property line within the pit. The operator incorrectly identified the reserves being mined as belonging to the Company instead of our neighboring landlord. After auditing and confirming the tenant’s findings, the Company has reached a resolution with the tenant to allow the overpayment to be deducted from a portion of future royalties, and we have worked with the tenant to improve processes and controls to prevent an incident of this type and magnitude from occurring in the future. This will impact future royalty revenue and revenue growth until the overpayment is satisfied.

Stabilized Joint Venture Segment:

In the fourth quarter of 2022, as part of our new partnership with Steuart Investment Company and MidAtlantic Realty Partners, we sold a 20% ownership interest in a tenancy-in-common (TIC) of Dock 79 and The Maren for $65.3 million, $44.5 million attributable to the Company, placing a combined valuation of the two buildings at $326.5 million.

Total revenues in this segment were $16,454,000, an increase of $493,000 versus $15,961,000 in the same period last year. The Maren’s revenue was $7,900,000, an increase of 5.7%, and Dock 79 revenues increased $66,000 or .8% to $8,553,000. Total operating profit in this segment was $2,556,000, an increase of $365,000 versus $2,191,000 in the same period last year. Pro-rata net operating income for this segment was $6,212,000, down $1,029,000 or 14.2% compared to the same period last year because of the sale of our 20% TIC interest in both properties to SIC, mitigated by $676,000 in pro-rata NOI from our share of the Riverside joint venture.

At the end of September, The Maren was 93.18% leased and 93.94% occupied. Average residential occupancy for the first nine months of 2023 was 96.11%, and 50.66% of expiring leases renewed with an average rent increase on renewals of 4.86%. The Maren is a joint venture between the Company and MRP and SIC, in which FRP Holdings, Inc. is the majority partner with 56.3% ownership.

Dock 79’s average residential occupancy for the first nine months of 2023 was 94.21%, and at the end of the quarter, Dock 79’s residential units were 93.44% leased and 95.74% occupied. Through the first nine months of the year, 67.90% of expiring leases renewed with an average rent increase on renewals of 3.11%. Dock 79 is a joint venture between the Company and MRP and SIC, in which FRP Holdings, Inc. is the majority partner with 52.8% ownership.

During the third quarter of 2022, we achieved stabilization at our Riverside Joint Venture in Greenville, South Carolina. At end of September, the building was 94.5% leased with 91.5% occupancy. Average occupancy for the first nine months of 2023 was 94.26% with 56.03% of expiring leases renewing with an average rental increase of 10.25%. Riverside is a joint venture with Woodfield Development and the Company owns 40% of the venture.

Summary and Outlook

Royalty revenue for this quarter was up 24.7% over the same period last year, and royalty revenue for the first nine months is up 23.8%. The last three quarters have been the three highest revenue quarters in this segment’s history. Mining royalty revenue for the last twelve months is $12.53 million, a 24.7% increase over the same period last year, and the segment’s highest revenue total over any twelve-month period.

In the Stabilized Joint Venture segment, pro-rata NOI is down for the segment for both the quarter and the first nine months, which is to be expected after selling 20% of our share of Dock 79 and The Maren to SIC. NOI for the two projects as a whole increased 1.0% ($10,163,000 vs $10,063,000) for the first nine months compared to the same period last year. At Dock 79, average occupancy (95.08%) remains in line with historic expectations, but the high renewal rate (71.43%) with reduced increases (2.30%) is consistent with a post-Covid glut in apartment supply in the DC market as evidenced by the negative trade-outs (-4.60%) we’re seeing at that building. The Maren performed slightly better with strong renewals (59.70%) at higher increases (3.18%) and positive trade-outs (4.60%), but at rates lower than we have experienced in the past prior to the second quarter of this year. Riverside in Greenville (which was added to this segment in the third quarter of 2022) has maintained strong occupancy (93.65% LTM) in its first year post-stabilization. Renewal rates for the quarter (52.83%) and year-to-date (56.03%) are consistent with expected results, and the increase on renewals (8.55% for Q3, 10.25% YTD) remain high. Our pro-rata share of NOI at Riverside this quarter was $231,000 and $676,000 for the first nine months.

In our Asset Management Segment, occupancy and our overall square-footage have increased since the third quarter of 2022, leading to a 46.2% increase in NOI for the first nine months compared to the same period last year. We are 95.6% leased and occupied on 548,785 square feet compared to 85.9% occupied on 447,035 square feet at the end of the third quarter of 2022.

As mentioned last quarter and in our recent Investor Day presentation, the heady cocktail of inflation, interest rates, increased construction costs, and a softening in the DC market because of an influx of new apartment projects have led us to shift our development strategy away from new developments in DC for the time being. We are shifting towards (relatively) less capital-intensive projects like warehouse construction, where we can use our cash on hand to finance construction on an all equity basis and develop in-demand industrial product while the interest rates on construction loans keep most development on the sidelines. To that end, we are underway on the construction of a $30 million spec warehouse project at our Chelsea site in Aberdeen, MD. We anticipate shell completion on this 259,200 square-foot building in the third quarter of 2024. We will continue to do the predevelopment work required to prepare the first phase of our partnership with SIC and MRP for vertical construction, but we will pause at that point until interest rates and construction costs come back in line with what’s required to make a reasonable return. We still have the utmost confidence in our assets and the markets in which they thrive. To that end, during the first nine months of 2023 we repurchased 36,909 shares at an average cost of $54.19 per share.

Conference Call

The Company will host a conference call on Thursday, November 9, 2023 at 10:00 a.m. (EDT). Analysts, stockholders and other interested parties may access the teleconference live by calling 1-800-274-8461 (passcode 82391) within the United States. International callers may dial 1-203-518-9814 (passcode 82391). Audio replay will be available until November 23, 2023 by dialing 1-888-567-0675 within the United States. International callers may dial 1-402-530-0417. No passcode needed. An audio replay will also be available on the Company’s investor relations page (https://www.frpdev.com/investor-relations/) following the call.

Investors are cautioned that any statements in this press release which relate to the future are, by their nature, subject to risks and uncertainties that could cause actual results and events to differ materially from those indicated in such forward-looking statements. These include, but are not limited to: the possibility that we may be unable to find appropriate investment opportunities; levels of construction activity in the markets served by our mining properties; demand for flexible warehouse/office facilities in the Baltimore-Washington-Northern Virginia area; demand for apartments in Washington D.C. and Greenville, South Carolina; our ability to obtain zoning and entitlements necessary for property development; the impact of lending and capital market conditions on our liquidity; our ability to finance projects or repay our debt; general real estate investment and development risks; vacancies in our properties; risks associated with developing and managing properties in partnership with others; competition; our ability to renew leases or re-lease spaces as leases expire; illiquidity of real estate investments; bankruptcy or defaults of tenants; the impact of restrictions imposed by our credit facility; the level and volatility of interest rates; environmental liabilities; inflation risks; cybersecurity risks; as well as other risks listed from time to time in our SEC filings; including but not limited to; our annual and quarterly reports. We have no obligation to revise or update any forward-looking statements, other than as imposed by law, as a result of future events or new information. Readers are cautioned not to place undue reliance on such forward-looking statements.

FRP Holdings, Inc. is a holding company engaged in the real estate business, namely (i) leasing and management of commercial properties owned by the Company, (ii) leasing and management of mining royalty land owned by the Company, (iii) real property acquisition, entitlement, development and construction primarily for apartment, retail, warehouse, and office, (iv) leasing and management of residential apartment buildings.

FRP HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share amounts)
(Unaudited)

 

THREE MONTHS ENDED

 

NINE MONTHS ENDED

 

SEPTEMBER 30,

 

SEPTEMBER 30,

 

2023

 

2022

 

2023

 

2022

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease revenue

$

7,509

 

 

 

6,823

 

 

 

21,773

 

 

 

19,850

 

Mining lands lease revenue

 

3,082

 

 

 

2,471

 

 

 

9,628

 

 

 

7,779

 

Total Revenues

 

10,591

 

 

 

9,294

 

 

 

31,401

 

 

 

27,629

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

2,816

 

 

 

2,744

 

 

 

8,415

 

 

 

8,510

 

Operating expenses

 

2,012

 

 

 

1,967

 

 

 

5,574

 

 

 

5,316

 

Property taxes

 

919

 

 

 

1,034

 

 

 

2,745

 

 

 

3,103

 

Management company indirect

 

1,059

 

 

 

966

 

 

 

2,938

 

 

 

2,545

 

Corporate expenses

 

889

 

 

 

734

 

 

 

3,212

 

 

 

2,876

 

Total cost of operations

 

7,695

 

 

 

7,445

 

 

 

22,884

 

 

 

22,350

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating profit

 

2,896

 

 

 

1,849

 

 

 

8,517

 

 

 

5,279

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

2,700

 

 

 

1,188

 

 

 

8,207

 

 

 

3,206

 

Interest expense

 

(1,116

)

 

 

(738

)

 

 

(3,251

)

 

 

(2,215

)

Equity in loss of joint ventures

 

(2,913

)

 

 

(1,878

)

 

 

(10,585

)

 

 

(5,248

)

Gain (loss) on sale of real estate

 

(1

)

 

 

141

 

 

 

7

 

 

 

874

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

1,566

 

 

 

562

 

 

 

2,895

 

 

 

1,896

 

Provision for (benefit from) income taxes

 

467

 

 

 

178

 

 

 

898

 

 

 

526

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

1,099

 

 

 

384

 

 

 

1,997

 

 

 

1,370

 

Loss attributable to noncontrolling interest

 

(160

)

 

 

(96

)

 

 

(425

)

 

 

(439

)

Net income attributable to the Company

$

1,259

 

 

 

480

 

 

 

2,422

 

 

 

1,809

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to the Company-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.13

 

 

 

0.05

 

 

 

0.26

 

 

 

0.19

 

Diluted

$

0.13

 

 

 

0.05

 

 

 

0.26

 

 

 

0.19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of shares (in thousands) used in computing:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-basic earnings per common share

 

9,423

 

 

 

9,397

 

 

 

9,423

 

 

 

9,382

 

-diluted earnings per common share

 

9,460

 

 

 

9,433

 

 

 

9,463

 

 

 

9,423

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FRP HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except share data)

 

 

September 30

 

December 31

Assets:

 

2023

 

2022

Real estate investments at cost:

 

 

 

 

 

 

 

 

Land

 

$

141,578

 

 

 

141,579

 

Buildings and improvements

 

 

282,379

 

 

 

270,579

 

Projects under construction

 

 

4,689

 

 

 

12,208

 

Total investments in properties

 

 

428,646

 

 

 

424,366

 

Less accumulated depreciation and depletion

 

 

65,444

 

 

 

57,208

 

Net investments in properties

 

 

363,202

 

 

 

367,158

 

 

 

 

 

 

 

 

 

 

Real estate held for investment, at cost

 

 

10,510

 

 

 

10,182

 

Investments in joint ventures

 

 

154,025

 

 

 

140,525

 

Net real estate investments

 

 

527,737

 

 

 

517,865

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

166,028

 

 

 

177,497

 

Cash held in escrow

 

 

646

 

 

 

797

 

Accounts receivable, net

 

 

1,683

 

 

 

1,166

 

Unrealized rents

 

 

1,452

 

 

 

856

 

Deferred costs

 

 

3,028

 

 

 

2,343

 

Other assets

 

 

583

 

 

 

560

 

Total assets

 

$

701,157

 

 

 

701,084

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Secured notes payable

 

$

178,668

 

 

 

178,557

 

Accounts payable and accrued liabilities

 

 

3,689

 

 

 

5,971

 

Other liabilities

 

 

1,886

 

 

 

1,886

 

Federal and state income taxes payable

 

 

704

 

 

 

18

 

Deferred revenue

 

 

1,029

 

 

 

259

 

Deferred income taxes

 

 

67,903

 

 

 

67,960

 

Deferred compensation

 

 

1,395

 

 

 

1,354

 

Tenant security deposits

 

 

889

 

 

 

868

 

Total liabilities

 

 

256,163

 

 

 

256,873

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

Common stock, $.10 par value 25,000,000 shares authorized, 9,477,104 and 9,459,686 shares issued and outstanding, respectively

 

 

948

 

 

 

946

 

Capital in excess of par value

 

 

67,168

 

 

 

65,158

 

Retained earnings

 

 

343,002

 

 

 

342,317

 

Accumulated other comprehensive loss, net

 

 

(328

)

 

 

(1,276

)

Total shareholders’ equity

 

 

410,790

 

 

 

407,145

 

Noncontrolling interest

 

 

34,204

 

 

 

37,066

 

Total equity

 

 

444,994

 

 

 

444,211

 

Total liabilities and equity

 

$

701,157

 

 

 

701,084

 

 

 

 

 

 

 

 

 

 

Asset Management Segment:

 

Three months ended September 30

 

 

 

 

(dollars in thousands)

2023

 

%

 

2022

 

%

 

Change

 

%

 

 

 

 

 

 

 

 

 

 

 

 

Lease revenue

$

1,442

 

 

 

100.0

%

 

 

935

 

 

 

100.0

%

 

 

507

 

 

 

54.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

369

 

 

 

25.5

%

 

 

219

 

 

 

23.4

%

 

 

150

 

 

 

68.5

%

Operating expenses

 

173

 

 

 

12.0

%

 

 

162

 

 

 

17.3

%

 

 

11

 

 

 

6.8

%

Property taxes

 

62

 

 

 

4.3

%

 

 

53

 

 

 

5.7

%

 

 

9

 

 

 

17.0

%

Management company indirect

 

141

 

 

 

9.8

%

 

 

109

 

 

 

11.7

%

 

 

32

 

 

 

29.4

%

Corporate expense

 

177

 

 

 

12.3

%

 

 

127

 

 

 

13.6

%

 

 

50

 

 

 

39.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

922

 

 

 

63.9

%

 

 

670

 

 

 

71.7

%

 

 

252

 

 

 

37.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

$

520

 

 

 

36.1

%

 

 

265

 

 

 

28.3

%

 

 

255

 

 

 

96.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mining Royalty Lands Segment:

 

 

Three months ended September 30

 

 

 

 

(dollars in thousands)

 

2023

 

%

 

2022

 

%

 

Change

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Mining lands lease revenue

 

$

3,082

 

 

 

100.0

%

 

 

2,471

 

 

 

100.0

%

 

 

611

 

 

 

24.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

138

 

 

 

4.5

%

 

 

172

 

 

 

7.0

%

 

 

(34

)

 

 

-19.8

%

Operating expenses

 

 

18

 

 

 

0.6

%

 

 

18

 

 

 

0.7

%

 

 

 

 

 

0.0

%

Property taxes

 

 

181

 

 

 

5.9

%

 

 

69

 

 

 

2.8

%

 

 

112

 

 

 

162.3

%

Management company indirect

 

 

137

 

 

 

4.4

%

 

 

129

 

 

 

5.2

%

 

 

8

 

 

 

6.2

%

Corporate expense

 

 

99

 

 

 

3.2

%

 

 

83

 

 

 

3.4

%

 

 

16

 

 

 

19.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

573

 

 

 

18.6

%

 

 

471

 

 

 

19.1

%

 

 

102

 

 

 

21.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

 

$

2,509

 

 

 

81.4

%

 

 

2,000

 

 

 

80.9

%

 

 

509

 

 

 

25.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Development Segment:

 

 

Three months ended September 30

(dollars in thousands)

 

2023

 

2022

 

Change

 

 

 

 

 

 

 

Lease revenue

 

$

434

 

 

 

412

 

 

 

22

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

44

 

 

 

47

 

 

 

(3

)

Operating expenses

 

 

48

 

 

 

250

 

 

 

(202

)

Property taxes

 

 

121

 

 

 

355

 

 

 

(234

)

Management company indirect

 

 

665

 

 

 

625

 

 

 

40

 

Corporate expense

 

 

529

 

 

 

457

 

 

 

72

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

1,407

 

 

 

1,734

 

 

 

(327

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss

 

$

(973

)

 

 

(1,322

)

 

 

349

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stabilized Joint Venture Segment:

 

 

Three months ended September 30

 

 

 

 

(dollars in thousands)

 

2023

 

%

 

2022

 

%

 

Change

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease revenue

 

$

5,633

 

 

 

100.0

%

 

 

5,476

 

 

 

100.0

%

 

 

157

 

 

 

2.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

2,265

 

 

 

40.2

%

 

 

2,306

 

 

 

42.1

%

 

 

(41

)

 

 

-1.8

%

Operating expenses

 

 

1,773

 

 

 

31.5

%

 

 

1,537

 

 

 

28.1

%

 

 

236

 

 

 

15.4

%

Property taxes

 

 

555

 

 

 

9.8

%

 

 

557

 

 

 

10.2

%

 

 

(2

)

 

 

-0.4

%

Management company indirect

 

 

116

 

 

 

2.1

%

 

 

103

 

 

 

1.9

%

 

 

13

 

 

 

12.6

%

Corporate expense

 

 

84

 

 

 

1.5

%

 

 

67

 

 

 

1.2

%

 

 

17

 

 

 

25.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

4,793

 

 

 

85.1

%

 

 

4,570

 

 

 

83.5

%

 

 

223

 

 

 

4.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

 

$

840

 

 

 

14.9

%

 

 

906

 

 

 

16.5

%

 

 

(66

)

 

 

-7.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Management Segment:

 

 

Nine months ended September 30

 

 

 

 

(dollars in thousands)

 

2023

 

%

 

2022

 

%

 

Change

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease revenue

 

$

3,932

 

 

 

100.0

%

 

 

2,686

 

 

 

100.0

%

 

 

1,246

 

 

 

46.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

1,006

 

 

 

25.6

%

 

 

683

 

 

 

25.4

%

 

 

323

 

 

 

47.3

%

Operating expenses

 

 

490

 

 

 

12.4

%

 

 

441

 

 

 

16.4

%

 

 

49

 

 

 

11.1

%

Property taxes

 

 

185

 

 

 

4.7

%

 

 

158

 

 

 

5.9

%

 

 

27

 

 

 

17.1

%

Management company indirect

 

 

396

 

 

 

10.1

%

 

 

301

 

 

 

11.2

%

 

 

95

 

 

 

31.6

%

Corporate expense

 

 

630

 

 

 

16.0

%

 

 

496

 

 

 

18.5

%

 

 

134

 

 

 

27.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

2,707

 

 

 

68.8

%

 

 

2,079

 

 

 

77.4

%

 

 

628

 

 

 

30.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

 

$

1,225

 

 

 

31.2

%

 

 

607

 

 

 

22.6

%

 

 

618

 

 

 

101.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mining Royalty Lands Segment:

 

 

Nine months ended September 30

 

 

 

 

(dollars in thousands)

 

2023

 

%

 

2022

 

%

 

Change

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Mining lands lease revenue

 

$

9,628

 

 

 

100.0

%

 

 

7,779

 

 

 

100.0

%

 

 

1,849

 

 

 

23.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

472

 

 

 

4.9

%

 

 

416

 

 

 

5.4

%

 

 

56

 

 

 

13.5

%

Operating expenses

 

 

51

 

 

 

0.5

%

 

 

50

 

 

 

0.6

%

 

 

1

 

 

 

2.0

%

Property taxes

 

 

324

 

 

 

3.4

%

 

 

203

 

 

 

2.6

%

 

 

121

 

 

 

59.6

%

Management company indirect

 

 

390

 

 

 

4.1

%

 

 

346

 

 

 

4.4

%

 

 

44

 

 

 

12.7

%

Corporate expense

 

 

360

 

 

 

3.7

%

 

 

325

 

 

 

4.2

%

 

 

35

 

 

 

10.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

1,597

 

 

 

16.6

%

 

 

1,340

 

 

 

17.2

%

 

 

257

 

 

 

19.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

 

$

8,031

 

 

 

83.4

%

 

 

6,439

 

 

 

82.8

%

 

 

1,592

 

 

 

24.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Development Segment:

 

 

Nine months ended September 30

(dollars in thousands)

 

2023

 

2022

 

Change

 

 

 

 

 

 

 

Lease revenue

 

$

1,387

 

 

 

1,203

 

 

 

184

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

140

 

 

 

139

 

 

 

1

 

Operating expenses

 

 

215

 

 

 

541

 

 

 

(326

)

Property taxes

 

 

587

 

 

 

1,066

 

 

 

(479

)

Management company indirect

 

 

1,822

 

 

 

1,621

 

 

 

201

 

Corporate expense

 

 

1,918

 

 

 

1,794

 

 

 

124

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

4,682

 

 

 

5,161

 

 

 

(479

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss

 

$

(3,295

)

 

 

(3,958

)

 

 

663

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stabilized Joint Venture Segment:

 

 

Nine months ended September 30

 

 

 

 

(dollars in thousands)

 

2023

 

%

 

2022

 

%

 

Change

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease revenue

 

$

16,454

 

 

 

100.0

%

 

 

15,961

 

 

 

100.0

%

 

 

493

 

 

 

3.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

6,797

 

 

 

41.3

%

 

 

7,272

 

 

 

45.6

%

 

 

(475

)

 

 

-6.5

%

Operating expenses

 

 

4,818

 

 

 

29.3

%

 

 

4,284

 

 

 

26.9

%

 

 

534

 

 

 

12.5

%

Property taxes

 

 

1,649

 

 

 

10.0

%

 

 

1,676

 

 

 

10.5

%

 

 

(27

)

 

 

-1.6

%

Management company indirect

 

 

330

 

 

 

2.0

%

 

 

277

 

 

 

1.7

%

 

 

53

 

 

 

19.1

%

Corporate expense

 

 

304

 

 

 

1.9

%

 

 

261

 

 

 

1.6

%

 

 

43

 

 

 

16.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of operations

 

 

13,898

 

 

 

84.5

%

 

 

13,770

 

 

 

86.3

%

 

 

128

 

 

 

0.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

 

$

2,556

 

 

 

15.5

%

 

 

2,191

 

 

 

13.7

%

 

 

365

 

 

 

16.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP Financial Measures.

To supplement the financial results presented in accordance with GAAP, FRP presents certain non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. We believe these non-GAAP measures provide useful information to our Board of Directors, management and investors regarding certain trends relating to our financial condition and results of operations. Our management uses these non-GAAP measures to compare our performance to that of prior periods for trend analyses, purposes of determining management incentive compensation and budgeting, forecasting and planning purposes. We provide Pro-rata net operating income (NOI) because we believe it assists investors and analysts in estimating our economic interest in our consolidated and unconsolidated partnerships, when read in conjunction with our reported results under GAAP. This measure is not, and should not be viewed as, a substitute for GAAP financial measures.

Pro-rata Net Operating Income Reconciliation

 

 

 

 

 

 

 

 

 

 

 

Nine months ended 09/30/23 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stabilized

 

 

 

 

 

 

 

Asset

 

 

 

Joint

 

Mining

 

Unallocated

 

FRP

 

Management

 

Development

 

Venture

 

Royalties

 

Corporate

 

Holdings

 

Segment

 

Segment

 

Segment

 

Segment

 

Expenses

 

Totals

Net Income (loss)

$

892

 

 

 

(7,192

)

 

 

(816

)

 

 

5,842

 

 

 

3,270

 

 

 

1,996

 

Income Tax Allocation

 

331

 

 

 

(2,667

)

 

 

(145

)

 

 

2,168

 

 

 

1,212

 

 

 

899

 

Income (loss) before income taxes

 

1,223

 

 

 

(9,859

)

 

 

(961

)

 

 

8,010

 

 

 

4,482

 

 

 

2,895

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized rents

 

531

 

 

 

 

 

 

 

 

 

143

 

 

 

 

 

 

674

 

Gain on sale of real estate

 

 

 

 

 

 

 

 

 

 

10

 

 

 

 

 

 

10

 

Interest income

 

 

 

 

3,692

 

 

 

 

 

 

 

 

 

4,515

 

 

 

8,207

 

Plus:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized rents

 

 

 

 

 

 

 

117

 

 

 

 

 

 

 

 

 

117

 

Loss on sale of real estate

 

2

 

 

 

 

 

 

1

 

 

 

 

 

 

 

 

 

3

 

Equity in loss of Joint Ventures

 

 

 

 

10,256

 

 

 

298

 

 

 

31

 

 

 

 

 

 

10,585

 

Professional fees - other

 

 

 

 

 

 

 

59

 

 

 

 

 

 

 

 

 

59

 

Interest Expense

 

 

 

 

 

 

 

3,218

 

 

 

 

 

 

33

 

 

 

3,251

 

Depreciation/Amortization

 

1,006

 

 

 

140

 

 

 

6,797

 

 

 

472

 

 

 

 

 

 

8,415

 

Management Co. Indirect

 

396

 

 

 

1,822

 

 

 

330

 

 

 

390

 

 

 

 

 

 

2,938

 

Allocated Corporate Expenses

 

630

 

 

 

1,918

 

 

 

304

 

 

 

360

 

 

 

 

 

 

3,212

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Operating Income

 

2,726

 

 

 

585

 

 

 

10,163

 

 

 

9,110

 

 

 

 

 

 

22,584

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI of noncontrolling interest

 

 

 

 

 

 

 

(4,627

)

 

 

 

 

 

 

 

 

(4,627

)

Pro-rata NOI from unconsolidated joint ventures

 

 

 

 

4,054

 

 

 

676

 

 

 

 

 

 

 

 

 

4,730

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pro-rata net operating income

$

2,726

 

 

 

4,639

 

 

 

6,212

 

 

 

9,110

 

 

 

 

 

 

22,687

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Pro-Rata Net Operating Income Reconciliation

 

 

 

 

 

 

 

 

 

 

 

Nine months ended 09/30/22 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stabilized

 

 

 

 

 

 

 

Asset

 

 

 

Joint

 

Mining

 

Unallocated

 

FRP

 

Management

 

Development

 

Venture

 

Royalties

 

Corporate

 

Holdings

 

Segment

 

Segment

 

Segment

 

Segment

 

Expenses

 

Totals

Net income (loss)

$

443

 

 

 

(4,953

)

 

 

(166

)

 

 

5,311

 

 

 

735

 

 

 

1,370

 

Income tax allocation

 

164

 

 

 

(1,837

)

 

 

101

 

 

 

1,969

 

 

 

129

 

 

 

526

 

Income (loss) before income taxes

 

607

 

 

 

(6,790

)

 

 

(65

)

 

 

7,280

 

 

 

864

 

 

 

1,896

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized rents

 

223

 

 

 

 

 

 

(62

)

 

 

153

 

 

 

 

 

 

314

 

Gain on sale of real estate

 

 

 

 

 

 

 

 

 

 

874

 

 

 

 

 

 

874

 

Interest income

 

 

 

 

2,311

 

 

 

 

 

 

 

 

 

895

 

 

 

3,206

 

Plus:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity in loss of joint ventures

 

 

 

 

5,143

 

 

 

72

 

 

 

33

 

 

 

 

 

 

5,248

 

Interest expense

 

 

 

 

 

 

 

2,184

 

 

 

 

 

 

31

 

 

 

2,215

 

Depreciation/amortization

 

683

 

 

 

139

 

 

 

7,272

 

 

 

416

 

 

 

 

 

 

8,510

 

Management company indirect

 

301

 

 

 

1,621

 

 

 

277

 

 

 

346

 

 

 

 

 

 

2,545

 

Allocated Corporate expenses

 

496

 

 

 

1,794

 

 

 

261

 

 

 

325

 

 

 

 

 

 

2,876

 

Net operating income (loss)

 

1,864

 

 

 

(404

)

 

 

10,063

 

 

 

7,373

 

 

 

 

 

 

18,896

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI of noncontrolling interest

 

 

 

 

 

 

 

(3,212

)

 

 

 

 

 

 

 

 

(3,212

)

Pro-rata NOI from unconsolidated joint ventures

 

 

 

 

1,896

 

 

 

390

 

 

 

 

 

 

 

 

 

2,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pro-rata net operating income

$

1,864

 

 

 

1,492

 

 

 

7,241

 

 

 

7,373

 

 

 

 

 

 

17,970

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following tables represent the Joint Venture and Development pro-rata NOI by project:

Development Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FRP

 

 

 

Bryant Street

 

 

 

BC FRP

 

 

 

.408

 

 

 

Verge

 

 

 

Total

 

Nine months ended

 

 

Portfolio

 

 

 

Partnership

 

 

 

Realty, LLC

 

 

 

Jackson

 

 

 

Partnership

 

 

 

Pro-rata NOI

 

9/30/2023

 

 

585

 

 

 

3,595

 

 

 

251

 

 

 

350

 

 

 

(142

)

 

 

4,639

 

9/30/2022

 

 

(404

)

 

 

1,853

 

 

 

277

 

 

 

(10

)

 

 

(224

)

 

 

1,492

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Stabilized Joint Venture Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Riverside

 

 

 

Total

 

Nine months ended

 

 

Dock 79

 

 

 

The Maren

 

 

 

Joint Venture

 

 

 

Pro-rata NOI

 

9/30/2023

 

 

2,825

 

 

 

2,711

 

 

 

676

 

 

 

6,212

 

9/30/2022

 

 

3,316

 

 

 

3,535

 

 

 

390

 

 

 

7,241

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONTACT: Contact: John D. Baker III Chief Financial Officer 904/858-9100