Agree Realty Corp (ADC) Reports Record Investment Grade Exposure in Q3 2023 Earnings
Net income for Q3 2023 increased by 5.6% to $39.7 million
Core FFO for Q3 2023 increased by 23.3% to $96.4 million
Investment grade exposure reached a record high of nearly 69% of annualized base rents
Company's portfolio consisted of 2,084 properties located in 49 states
Agree Realty Corp (NYSE:ADC) released its Q3 2023 earnings on October 24, 2023, reporting a 5.6% increase in net income to $39.7 million, compared to $37.6 million for the same period in 2022. The company's Core FFO for the quarter also saw a significant increase, rising by 23.3% to $96.4 million from $78.2 million in Q3 2022.
Financial Highlights
Agree Realty Corp (NYSE:ADC) reported a 5.6% increase in net income for the three months ended September 30, 2023, compared to the same period in 2022. However, net income per share decreased by 12.4% to $0.41. For the nine months ended September 30, 2023, net income increased by 11.8% to $118.4 million, but net income per share decreased by 9.4% to $1.26.
The company's Core FFO for the three months ended September 30, 2023, increased by 23.3% to $96.4 million, compared to $78.2 million for the same period in 2022. Core FFO per share for the three months ended September 30, 2023, increased by 2.1% to $0.99. For the nine months ended September 30, 2023, Core FFO increased by 24.4% to $276.8 million, and Core FFO per share increased by 0.8% to $2.94.
Dividend and Portfolio Update
In Q3 2023, Agree Realty Corp (NYSE:ADC) declared monthly cash dividends of $0.243 per common share, reflecting an annualized dividend amount of $2.916 per common share, a 3.8% increase over the annualized dividend amount of $2.808 per common share from Q3 2022. The company's portfolio as of September 30, 2023, consisted of 2,084 properties located in 49 states and contained approximately 43.2 million square feet of gross leasable area.
CEO's Commentary
We are very pleased with our year-to-date performance as we continue to bolster the strength of our portfolio via investment activity, with a record of nearly 69% of annualized base rents coming from investment grade retailers," said Joey Agree, President and Chief Executive Officer. "Looking forward, we are well positioned to execute on unique opportunities across all three external growth platforms, while being disciplined allocators of capital during these turbulent times.
Acquisitions and Dispositions
During Q3 2023, Agree Realty Corp (NYSE:ADC) acquired 74 properties for a total acquisition volume of approximately $398.3 million. The company sold one property for gross proceeds of approximately $0.2 million. For the nine months ended September 30, 2023, the company sold two properties for total gross proceeds of $3.3 million.
In conclusion, Agree Realty Corp (NYSE:ADC) demonstrated strong financial performance in Q3 2023, with significant increases in net income and Core FFO. The company's record investment grade exposure and robust portfolio growth position it well for future success.
This article first appeared on GuruFocus.
