Easterly Government Properties (DEA) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $4.9 million ($0.04 per share), with Core FFO at $31.4 million ($0.29 per share), driven by new government-leased acquisitions and a focus on mission-critical real estate.

• Revenue rose to $76.2 million for Q2 2024, up $4.8 million year-over-year, supported by six property acquisitions since June 2023.

• Portfolio comprised 93 operating properties (9.1 million sq. ft.), 97% leased, with two properties under development and a weighted average lease term of 10.1 years.

• Expanded strategy includes government-adjacent tenants and defense industry partners.

• Released 2023 ESG report, achieving a 4% energy usage reduction and 16 ENERGY STAR certifications.

Financial highlights

• Q2 2024 revenues were $76.2 million, up from $71.4 million in Q2 2023; rental income was $72.2 million.

• Q2 2024 Core FFO per share was $0.29; cash available for distribution was $24.8 million.

• FFO for Q2 2024 was $30.7 million; EBITDA was $45.9 million.

• Six-month 2024 net income was $9.7 million ($0.09 per share); Core FFO was $62.1 million ($0.58 per share).

• Dividend per share for Q2 2024 was $0.265, payable August 13, 2024.

Outlook and guidance

• Full-year 2024 Core FFO per share guidance maintained at $1.15–$1.17 on a fully diluted basis.

• Guidance assumes $41 million JV acquisition, $50 million in wholly owned acquisitions, and $100–$110 million in development investment for 2024.

• Targeting 2%-3% Core FFO per share growth year-over-year for the coming years.

• Management expects cash flows from operations, JV distributions, and available credit to cover all anticipated uses for the next 12 months.

• Significant development pipeline and expectation to achieve historical payout ratio within 24 months.