LXP Industrial Trust Reports Third Quarter 2022 Results

NEW YORK, Nov. 03, 2022 (GLOBE NEWSWIRE) — LXP Industrial Trust (“LXP”) (NYSE:LXP), an actual property funding belief centered on single-tenant warehouse/distribution actual property investments, immediately introduced outcomes for the quarter ended September 30, 2022.

Third Quarter 2022 Highlights

• Recorded Net Income attributable to widespread shareholders of $21.8 million, or $0.08 per diluted widespread share.
• Generated Adjusted Company Funds From Operations out there to all equityholders and unitholders – diluted (“Adjusted Company FFO”) of $48.1 million, or $0.17 per diluted widespread share.
• Completed 0.3 million sq. toes of latest leases and lease extensions, elevating industrial Base and Cash Base Rents by 47.0% and 40.7%, respectively.
• Invested an mixture of $70.6 million in six ongoing growth tasks.
• Completed building of a 1.1 million sq. foot warehouse/distribution facility within the Columbus, Ohio market.
• Amended unsecured credit score facility extending the maturity of the revolving credit score portion to July 2026.
• Repurchased and retired 5.6 million widespread shares for a mean value of $10.16 per share and elevated repurchase authorization by 10.0 million widespread shares.
• Disposed of three properties for an mixture gross sale value of $92.0 million.

Subsequent Events

• Completed 0.6 million sq. toes of latest leases and lease extensions, elevating industrial Base and Cash Base Rents by 38.1% and 42.6%, respectively.
• Leased roughly 100 acres of land within the Phoenix, Arizona marketplace for 20 years.
• Repurchased and retired 0.4 million widespread shares at a mean value of $9.10 per share.

T. Wilson Eglin, Chairman and Chief Executive Officer of LXP, commented, “We are pleased with our third quarter results, as we continued to realize gains through asset sales, raised rents and strategically invest capital to enhance our portfolio value. Given the strength of our portfolio and operations, the Board of Trustees increased our quarterly dividend by 4.2% for the fourth quarter. Our portfolio is performing well with 6.2% industrial Same Store NOI growth this quarter and we continue to see solid tenant demand, reflecting the strength of our high quality assets located in desirable growth markets and the resilience of our business.”

FINANCIAL RESULTS

Revenues

For the quarter ended September 30, 2022, whole gross revenues have been $80.1 million, in contrast with whole gross revenues of $83.4 million for the quarter ended September 30, 2021. The lower is primarily attributable to property gross sales, together with the recapitalization of our particular objective industrial portfolio in 2021 now owned in a non-consolidated three way partnership, which was partially offset by acquisitions.

Net Income Attributable to Common Shareholders

For the quarter ended September 30, 2022, internet revenue attributable to widespread shareholders was $21.8 million, or $0.08 per diluted share, in contrast with internet revenue attributable to widespread shareholders for the quarter ended September 30, 2021 of $5.0 million, or $0.02 per diluted share.

Adjusted Company FFO

For the quarter ended September 30, 2022, LXP generated Adjusted Company FFO of $48.1 million, or $0.17 per diluted share, in comparison with Adjusted Company FFO for the quarter ended September 30, 2021 of $53.6 million, or $0.19 per diluted share.

Dividends/Distributions

LXP introduced that it declared a daily quarterly widespread share/unit dividend/distribution for the quarter ending December 31, 2022 of $0.125 per widespread share/unit payable January 17, 2023 to widespread shareholders/unitholders of report as of December 30, 2022. This represents a rise of 4.2% from the earlier quarterly per share widespread share/unit dividend/distribution and equates to an annualized enhance of $0.02 per widespread share/unit and an annualized dividend/distribution of $0.50 per widespread share/unit, topic to and assuming future declarations.

LXP additionally introduced that it declared a money dividend of $0.8125 per share of Series C Cumulative Convertible Preferred Stock (“Series C Preferred”) for the quarter ending December 31, 2022, which is anticipated to be paid on February 15, 2023 to shareholders of report as of January 31, 2023.

As beforehand introduced, in the course of the third quarter of 2022, LXP declared a daily quarterly widespread share/unit dividend/distribution for the quarter ended September 30, 2022 of $0.12 per widespread share/unit, which was paid on October 17, 2022 to widespread shareholders/unitholders of report as of September 30, 2022. LXP additionally declared a money dividend of $0.8125 per share of Series C Preferred for the quarter ending September 30, 2022, which is anticipated to be paid on November 15, 2022 to Series C Preferred shareholders of report as of October 31, 2022.

1. A land parcel positioned in Hebron, OH was bought for $747.
2. Generally, quarterly interval previous to sale, annualized.
3. Tenant exercised fixed-rate buy choice.

The above properties have been bought at aggregated weighted-average GAAP and Cash capitalization charges of 5.4% and 5.1%, respectively. As of September 30, 2022 whole consolidated 2022 property disposition quantity was $147.3 million at mixture weighted-average GAAP and Cash capitalization charges of 5.7%.

1. Estimated challenge value consists of estimated tenant enhancements and leasing prices and excludes potential developer companion promote, if any.
2. Excludes noncontrolling pursuits’ share.
3. Base constructing considerably accomplished on September 30, 2022. Property shouldn’t be in service.
4. Pre-leased 797,936 sq. foot facility topic to a 12-year lease commencing upon substantial completion of the power.
5. Pre-leased 392,278 sq. foot facility topic to a 10-year lease commencing upon substantial completion of the power.

1. Excludes noncontrolling pursuits’ share.
2. Subsequent to quarter finish, leased roughly 100 acres of the 420 acre developable land parcel positioned within the Phoenix, AZ market, topic to a 20-year lease (with three 10 12 months extension choices) that may begin in November 2022. The preliminary annual rental funds are estimated to be $5.2 million and escalate by 4% yearly.

1. No prior leases.  This tenant leased first technology house that was acquired vacant in 2021. 
2. Lease expiration date is estimated.

As of September 30, 2022, LXP’s stabilized industrial portfolio was 99.4% leased. A complete of three.5 million sq. toes of latest and prolonged industrial leases have been entered into from January 1, 2022 by September 30, 2022, with Base and Cash Base Rents rising by 29.1% and 21.8%, respectively.

BALANCE SHEET/CAPITAL MARKETS

LXP amended its unsecured revolving credit score facility and 2025 time period mortgage with a brand new unsecured revolving credit score facility and the continuation of the 2025 time period mortgage, which (i) prolonged the maturity date of the revolving portion from February 2023 to July 2026, with two six-month extension choices, topic to sure circumstances, (ii) diminished the relevant margin for the revolving portion by 5 foundation factors and permits for additional reductions upon the achievement of to-be-determined sustainability metrics, (iii) amended the debt covenants by lowering the capitalization fee for figuring out asset worth, and (iv) transitioned the power to SOFR.

Also within the third quarter, LXP’s Board of Trustees elevated the quantity of widespread shares out there for repurchase beneath its repurchase authorization by 10.0 million widespread shares. During the third quarter of 2022, LXP repurchased and retired 5.6 million widespread shares for a mean value of $10.16 per share. Subsequent to September 30, 2022, LXP repurchased and retired 0.4 million widespread shares for a mean value of $9.10 per share.

As of September 30, 2022, LXP had an mixture of $182.1 million beneath unsettled ahead widespread share gross sales contracts, that are topic to adjustment in accordance with the ahead gross sales contracts and mature in December 2022.  

As of September 30, 2022, LXP ended the quarter with internet debt to Adjusted EBITDA at 7.1x (or 6.3x together with ahead widespread share gross sales contracts). LXP’s whole consolidated debt was $1.6 billion at quarter finish with 84% at mounted charges. The whole consolidated debt had a weighted-average time period to maturity of 6.5 years and a weighted-average rate of interest of three.1% as of September 30, 2022.

2022 EARNINGS GUIDANCE

LXP now estimates that its internet revenue attributable to widespread shareholders for the 12 months ended December 31, 2022 will likely be inside an anticipated vary of $0.36 to $0.39 per diluted widespread share. LXP can be tightening its Adjusted Company FFO for the 12 months ended December 31, 2022, to be inside an anticipated vary of $0.65 and $0.68 per diluted widespread share. This steerage is ahead wanting, excludes the influence of sure objects and relies on present expectations.

THIRD QUARTER 2022 CONFERENCE CALL

LXP will host a convention name immediately, November 3, 2022, at 8:30 a.m. Eastern Time, to debate its outcomes for the quarter ended September 30, 2022. Interested events could take part on this convention name by dialing 1-888-660-6082 or 1-929-201-6604. Conference ID is 1576583. A replay of the decision will likely be out there by February 1, 2023, at 1-800-770-2030 or 1-647-362-9199, pin code for all replay numbers is 1576583. A hyperlink to a stay webcast of the convention name is out there at www.lxp.com throughout the Investors part or at https://events.q4inc.com/attendee/538896963.

LXP Industrial Trust (NYSE: LXP) is a publicly traded actual property funding belief (REIT) centered on single-tenant industrial actual property investments throughout the United States. LXP seeks to increase its industrial portfolio by acquisitions, build-to-suit transactions, sale-leaseback transactions, growth tasks and different transactions. For extra data, together with LXP’s Quarterly Supplemental Information bundle, or to observe LXP on social media, go to www.lxp.com.

Contact:
Investor or Media Inquiries for LXP Industrial Trust:
Heather Gentry, Senior Vice President of Investor Relations
LXP Industrial Trust
Phone: (212) 692-7200 E-mail: [email protected]

This launch accommodates sure forward-looking statements which contain identified and unknown dangers, uncertainties or different components not beneath LXP’s management which can trigger precise outcomes, efficiency or achievements of LXP to be materially completely different from the outcomes, efficiency, or different expectations implied by these forward-looking statements. Factors that would trigger or contribute to such variations embrace, however usually are not restricted to, these mentioned beneath the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in LXP’s periodic experiences filed with the Securities and Exchange Commission, together with dangers associated to: (1) nationwide, regional and native financial and political climates have potential opposed influence on LXP or its tenants from the novel coronavirus (COVID-19); (2) the authorization by LXP’s Board of Trustees of future dividend declarations, (3) LXP’s skill to attain its estimates of internet revenue attributable to widespread shareholders and Adjusted Company FFO for the 12 months ending December 31, 2022, (4) the profitable consummation of any lease, acquisition, build-to-suit, disposition, financing or different transaction, (5) the failure to proceed to qualify as an actual property funding belief, (6) adjustments typically business and financial circumstances, together with the influence of any laws, (7) competitors, (8) will increase in actual property building prices and building schedule delays, (9) adjustments in monetary markets and rates of interest, (10) adjustments in accessibility of debt and fairness capital markets, (11) future impairment costs, and (12) dangers associated to our investments in our nonconsolidated joint ventures. Copies of the periodic experiences LXP recordsdata with the Securities and Exchange Commission can be found on LXP’s website online at www.lxp.com. Forward-looking statements, that are primarily based on sure assumptions and describe LXP’s future plans, methods and expectations, are usually identifiable by use of the phrases “believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects”, “may,” “plans,” “predicts,” “will,” “will likely result,” “is optimistic,” “goal,” “objective” or comparable expressions. Except as required by legislation, LXP undertakes no obligation to publicly launch the outcomes of any revisions to these forward-looking statements which can be made to replicate occasions or circumstances after the incidence of unanticipated occasions. Accordingly, there is no such thing as a assurance that LXP’s expectations will likely be realized.

References to LXP discuss with LXP Industrial Trust and its consolidated subsidiaries. All pursuits in properties and loans are held, and all property working actions are carried out, by particular objective entities, that are separate and distinct authorized entities that keep separate books and data, however in some cases are consolidated for monetary assertion functions and/or disregarded for revenue tax functions. The property and credit score of every particular objective entity with a property topic to a mortgage mortgage usually are not out there to collectors to fulfill the debt and different obligations of every other individual, together with every other particular objective entity or affiliate. Consolidated entities that aren’t property proprietor subsidiaries don’t straight personal any of the property of a property proprietor subsidiary (or the final companion, member of managing member of such property proprietor subsidiary), however merely maintain partnership, membership or helpful pursuits therein which pursuits are subordinate to the claims of the property proprietor subsidiary’s (or its normal companion’s, member’s or managing member’s) collectors.

Non-GAAP Financial Measures – Definitions

LXP has used non-GAAP monetary measures as outlined by the Securities and Exchange Commission Regulation G on this Quarterly Earnings Release and in different public disclosures.

LXP believes that the measures outlined beneath are useful to buyers in measuring our efficiency or that of a person funding. Since these measures exclude sure objects that are included of their respective most comparable measures beneath usually accepted accounting ideas (“GAAP”), reliance on the measures has limitations; administration compensates for these limitations by utilizing the measures merely as supplemental measures which are weighed in steadiness with different GAAP measures. These measures usually are not essentially indications of our money circulate out there to fund money wants. Additionally, they shouldn’t be used as an alternative choice to the respective most comparable GAAP measures when evaluating LXP’s monetary efficiency or money circulate from working, investing or financing actions or liquidity.

Adjusted EBITDA: Adjusted EBITDA represents EBITDA (earnings earlier than curiosity, taxes, depreciation and amortization) modified to incorporate different changes to GAAP internet revenue for beneficial properties on gross sales of properties, impairment costs, debt satisfaction beneficial properties (losses), internet, non-cash costs, internet, straight-line changes, non-recurring costs and changes for pro-rata share of non-wholly owned entities. LXP’s calculation of Adjusted EBITDA is probably not corresponding to equally titled measures utilized by different firms. LXP believes that internet revenue is probably the most straight comparable GAAP measure to Adjusted EBITDA.

Base Rent: Base Rent is calculated by making changes to GAAP rental income to exclude billed tenant reimbursements and lease termination revenue and to incorporate ancillary revenue. Base Rent excludes reserves/write-offs of deferred lease receivable, as relevant. LXP believes Base Rent supplies a significant measure as a result of internet lease construction of leases within the portfolio.

Cash Base Rent: Cash Base Rent is calculated by making changes to GAAP rental income to take away the influence of GAAP required changes to rental revenue reminiscent of changes for straight-line rents associated to free lease intervals and contractual lease will increase. Cash Base Rent excludes billed tenant reimbursements and lease termination revenue and consists of ancillary revenue. LXP believes Cash Base Rent supplies a significant indication of an investments skill to fund money wants.

Company Funds Available for Distribution (“FAD”): FAD is calculated by making changes to Adjusted Company FFO (see beneath) for (1) straight-line changes, (2) lease incentive amortization, (3) amortization of above/beneath market leases, (4) lease termination funds, internet, (5) non-cash curiosity, (6) non-cash costs, internet, (7) capitalized curiosity and inside prices, (8) money paid for second technology tenant enhancements, and (9) money paid for second technology lease prices. Although FAD is probably not corresponding to that of different actual property funding trusts (“REITs”), LXP believes it supplies a significant indication of its skill to fund money wants. FAD is a non-GAAP monetary measure and shouldn’t be seen in its place measurement of working efficiency to internet revenue, as an alternative choice to internet money flows from working actions or as a measure of liquidity.

First Generation Costs: Represents money spend for tenant enhancements and leasing prices for in-service growth tasks and expenditures contemplated at acquisition for not too long ago acquired properties. Because all firms don’t calculate First Generation Costs the identical manner, LXP’s presentation is probably not corresponding to equally titled measures of different firms.

Funds from Operations (“FFO”) and Adjusted Company FFO: LXP believes that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely known and acceptable measure of the efficiency of an fairness REIT. LXP believes FFO is often utilized by securities analysts, buyers and different events within the analysis of REITs, a lot of which current FFO when reporting their outcomes. FFO is meant to exclude GAAP historic value depreciation and amortization of actual property and associated property, which assumes that the worth of actual property diminishes ratably over time. Historically, nevertheless, actual property values have risen or fallen with market circumstances. As a outcome, FFO supplies a efficiency measure that, in comparison 12 months over 12 months, displays the influence to operations from tendencies in occupancy charges, rental charges, working prices, growth actions, curiosity prices and different issues with out the inclusion of depreciation and amortization, offering perspective that will not essentially be obvious from internet revenue.

The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as “net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sales of certain real estate assets, gains and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO.” FFO doesn’t signify money generated from working actions in accordance with GAAP and isn’t indicative of money out there to fund money wants.

LXP presents FFO out there to widespread shareholders and unitholders – fundamental and in addition presents FFO out there to all equityholders and unitholders – diluted on a company-wide foundation as if all securities which are convertible, on the holder’s choice, into LXP’s widespread shares, are transformed in the beginning of the interval. LXP additionally presents Adjusted Company FFO out there to all equityholders and unitholders – diluted which adjusts FFO out there to all equityholders and unitholders – diluted for sure objects which we consider usually are not indicative of the working outcomes of LXP’s actual property portfolio. LXP believes that is an acceptable presentation as it’s often requested by safety analysts, buyers and different events. Since others don’t calculate these measures similarly, these measures is probably not corresponding to equally titled measures as reported by others. These measures shouldn’t be thought-about as an alternative choice to internet revenue as an indicator of LXP’s working efficiency or as an alternative choice to money circulate as a measure of liquidity.

GAAP and Cash Yield or Capitalization Rate: GAAP and money yields or capitalization charges are measures of working efficiency used to judge the person efficiency of an funding. These measures are estimates and usually are not offered or supposed to be seen as a liquidity or efficiency measure that current a numerical measure of LXP’s historic or future monetary efficiency, monetary place or money flows. The yield or capitalization fee is calculated by dividing the annualized NOI (as outlined beneath, besides GAAP lease changes are added again to rental revenue to calculate GAAP yield or capitalization fee) the funding is anticipated to generate, (or has generated) divided by the acquisition/completion value, (or sale value). Stabilized yields assume 100% occupancy and the cost of estimated prices to attain 100% occupancy together with companion promotes, if any.

Net Operating Income (“NOI”): NOI is a measure of working efficiency used to judge the person efficiency of an funding. This measure shouldn’t be offered or supposed to be seen as a liquidity or efficiency measure that presents a numerical measure of LXP’s historic or future monetary efficiency, monetary place or money flows. LXP defines NOI as working revenues (rental revenue (much less GAAP lease changes and lease termination revenue, internet), and different property revenue) much less property working bills. Other REITs could use completely different methodologies for calculating NOI, and accordingly, LXP’s NOI is probably not corresponding to different firms. Because NOI excludes normal and administrative bills, curiosity expense, depreciation and amortization, acquisition-related bills, different nonproperty revenue and losses, and beneficial properties and losses from property tendencies, it supplies a efficiency measure that, in comparison 12 months over 12 months, displays the revenues and bills straight related to proudly owning and working business actual property and the influence to operations from tendencies in occupancy charges, rental charges, and working prices, offering a perspective on operations not instantly obvious from internet revenue. LXP believes that internet revenue is probably the most straight comparable GAAP measure to NOI.

Second Generation Costs: Represents money spend for tenant enhancements and leasing prices to keep up revenues at present properties and are a part of the FAD calculation. LXP believes that second technology constructing enhancements signify an funding in present stabilized properties.

Stabilized Portfolio: All actual property properties apart from acquired or developed properties that haven’t achieved 90% occupancy inside one-year of acquisition or substantial completion.

(1)  Gain acknowledged upon train of the tenant’s buy choice within the lease.
(2)  Includes transaction, strategic options and prices associated to shareholder activism.         
(3)  Includes all OP models apart from OP models held by us.

(1)  Assumes all convertible securities are dilutive.