LXP Industrial Trust Reports First Quarter 2023 Results

LXP Industrial Trust

NEW YORK, May 03, 2023 (GLOBE NEWSWIRE) -- LXP Industrial Trust (“LXP”) (NYSE:LXP), a real estate investment trust focused on single-tenant warehouse/distribution real estate investments, today announced results for the quarter ended March 31, 2023.

First Quarter 2023 Highlights

• Recorded Net Income attributable to common shareholders of $9.5 million, or $0.03 per diluted common share.

• Generated Adjusted Company Funds From Operations available to all equityholders and unitholders - diluted (“Adjusted Company FFO”) of $50.3 million, or $0.17 per diluted common share.

• Completed 2.3 million square feet of lease extensions, raising industrial Base and Cash Base Rents by 45.0% and 28.5%, respectively.

• Increased Industrial Same-Store NOI to 5.0% in the first quarter compared to the same time period in 2022.

• Completed and placed into service a warehouse/distribution facility containing 0.4 million square feet in the Phoenix, Arizona market, subject to a 10-year lease.

• Completed construction of two warehouse/distribution facilities containing 2.1 million square feet in the Central Florida and Indianapolis, Indiana markets.

• Invested an aggregate of $34.6 million in development activities, including $31.0 million in six ongoing development projects.

• Disposed of one property for a gross sale price of $27.9 million.

Subsequent Events

• Fully leased the 1.1 million square foot completed warehouse/distribution project in the Columbus, Ohio market.

• Completed construction of a 1.1 million square foot warehouse/distribution facility in the Greenville - Spartanburg market.

T. Wilson Eglin, Chairman and Chief Executive Officer of LXP, commented “We continue to execute exceptionally well on capturing market rent growth, with 2.3 million square feet leased during the quarter at Base and Cash Base rental increases of approximately 59% and 42%, respectively, when adjusted for one fixed rate renewal. Rents in our portfolio continue to be well below market and we look forward to a higher period of lease rollover in 2024. We completed an additional 2.5 million square feet of development projects in the quarter, including our 400,000 square foot Phoenix facility, which was placed into service, and subject to a 10-year lease with 3.5% annual escalations. Our development initiatives continue to produce favorable outcomes, and as a result, we are raising our estimate of cash stabilized yields on the remaining 4.3 million square foot development pipeline to a range of 6.0% to 6.5%.”

FINANCIAL RESULTS

Revenues

For the quarter ended March 31, 2023, total gross revenues were $85.1 million, compared with total gross revenues of $80.3 million for the quarter ended March 31, 2022. The increase is primarily attributable to revenue from acquisitions and stabilized development projects, which was partially offset by sales.

Net Income Attributable to Common Shareholders

For the quarter ended March 31, 2023, net income attributable to common shareholders was $9.5 million, or $0.03 per diluted share, compared with net income attributable to common shareholders for the quarter ended March 31, 2022 of $9.0 million, or $0.03 per diluted share.

Adjusted Company FFO

For the quarter ended March 31, 2023, LXP generated Adjusted Company FFO of $50.3 million, or $0.17 per diluted share, compared to Adjusted Company FFO for the quarter ended March 31, 2022 of $48.1 million, or $0.16 per diluted share.

Dividends/Distributions

LXP announced that it declared a regular quarterly common share/unit dividend/distribution for the quarter ending March 31, 2023 of $0.125 per common share/unit, which was paid April 17, 2023 to common shareholders/unitholders of record as of March 31, 2023.

LXP also announced that it declared a cash dividend of $0.8125 per share of Series C Cumulative Convertible Preferred Stock (“Series C Preferred”) for the quarter ending March 31, 2023, which is expected to be paid on May 15, 2023 to shareholders of record as of April 28, 2023.

TRANSACTION ACTIVITY

STABILIZED DEVELOPMENT
Property Type		Market		Sq. Ft.		Initial Cost Basis ($000)			Approximate Lease Term (Yrs)		% Leased at Completion
Warehouse/distribution(1)		Phoenix, Arizona		392,278		$	37,118		10.0		100	%

1. Substantially completed and placed into service development project. LXP owns 93%. Initial cost basis excludes $1.9 million of lease commissions and certain remaining costs, including developer partner promote, if any. LXP funded an aggregate of $32.7 million as of March 31, 2023 for this project, of which, $1.6 million was funded in the first quarter of 2023.

ONGOING DEVELOPMENT PROJECTS
Project (% owned)	# of Buildings	Market	Estimated Sq. Ft.		Estimated Project Cost(1) ($000)			GAAP Investment Balance as of 03/31/23 ($000)			LXP Amount Funded as of 03/31/23 ($000)(2)			Actual/Estimated Building Completion Date		% Leased as of 03/31/23
Consolidated:
The Cubes at Etna East (95%)(3)	1	Columbus, OH	1,074,840		$	72,850		$	61,240		$	59,888		3Q 2022		(4	)
Ocala (80%)(3)	1	Central Florida	1,085,280			83,100			76,529			66,593		1Q 2023		—	%
Mt. Comfort (80%)(3)	1	Indianapolis, IN	1,053,360			65,500			61,614			52,119		1Q 2023		—	%
South Shore (100%)	2	Central Florida	270,885			41,200			31,844			26,277		2Q 2023		—	%
Smith Farms (90%)(5)	2	Greenville-Spartanburg, SC	1,396,772			101,550			85,290			72,690		2Q 2023		—	%
Cotton 303 (93%)(6)	1	Phoenix, AZ	488,400			44,100			33,310			31,458		3Q 2023		—	%
	8		5,369,537		$	408,300		$	349,827		$	309,025

1. Estimated project cost includes estimated tenant improvements and leasing costs and excludes potential developer partner promote, if any.

2. Excludes noncontrolling interests' share.

3. Base building achieved substantial completion. Property is not in service as of March 31, 2023.

4. Subsequent to quarter end, the property was fully leased subject to a 10-year lease with initial annualized rent of approximately $5.2 million with 3.5% annual escalations.

5. Subsequent to quarter end, the base building comprised of 1,091,888 square feet was substantially completed.

6. Originally a two building project. In March 2023, substantially completed and placed into service a 392,278 square foot facility subject to a 10-year lease. Remaining project ongoing.

LAND HELD FOR INDUSTRIAL DEVELOPMENT

Project (% owned)		Market		Approx. Developable Acres		GAAP Investment Balance as of 03/31/23 ($000)			LXP Amount Funded as of 03/31/23 ($000)(1)
Consolidated:
Reems & Olive (95.5%)		Phoenix, AZ		320		$	77,473		$	74,109
Mt. Comfort Phase II (80%)		Indianapolis, IN		116			5,303			4,250
ATL Fairburn JV (100%)		Atlanta, GA		14			1,731			1,736
				450		$	84,507		$	80,095

Project (% owned)		Market		Approx. Developable Acres		GAAP Investment Balance as of 03/31/23 ($000)			LXP Amount Funded as of 03/31/23 ($000)(1)
Non-consolidated:
ETNA Park 70 (90%)		Columbus, OH		66		$	13,348		$	14,009
ETNA Park 70 East (90%)		Columbus, OH		21			2,135			2,405
				87		$	15,483		$	16,414

1. Excludes noncontrolling interests' share.

PROPERTY DISPOSITIONS

Location		Property Type		Gross Disposition Price ($000)			Annualized Net Income(1) ($000)			Annualized NOI(1) ($000)			Month of Disposition		% Leased
Detroit, MI		Industrial		$	27,910		$	1,216		$	2,203		March		100	%

1. Generally, quarterly period prior to sale, annualized.

The above property was sold at GAAP and Cash capitalization rates of 7.9%, respectively.

LEASING

During the first quarter of 2023, LXP executed the following lease extensions:

LEASE EXTENSIONS - SECOND GENERATION

Location

Prior Term

Lease Expiration Date

Sq. Ft.

Industrial

1

Lebanon

IN

01/2024

01/2029

741,880

2

McDonough

GA

10/2023

10/2030

676,000

3

Cleveland

TN

03/2024

03/2031

851,370

3

TOTAL EXTENDED LEASES - SECOND GENERATION

2,269,250

As of March 31, 2023, LXP's stabilized industrial portfolio was 99.5% leased. A total of 2.3 million square feet of extended industrial leases were entered into through March 31, 2023, with Base and Cash Base Rents increasing by 45.0% and 28.5%, respectively.

BALANCE SHEET/CAPITAL MARKETS

As of March 31, 2023, LXP ended the quarter with net debt to Adjusted EBITDA at 6.3x. LXP's total consolidated debt was $1.5 billion at quarter end with 91.4% at fixed rates. The total consolidated debt had a weighted-average term to maturity of 6.3 years and a weighted-average interest rate of 3.2% as of March 31, 2023.

2023 EARNINGS GUIDANCE

LXP now estimates that its net income attributable to common shareholders for the year ended December 31, 2023 will be within an expected range of $0.18 to $0.22 per diluted common share. LXP reaffirms that its estimated Adjusted Company FFO for the year ended December 31, 2023, will be within an expected range of $0.66 and $0.70 per diluted common share. This guidance is forward looking, excludes the impact of certain items and is based on current expectations.

FIRST QUARTER 2023 CONFERENCE CALL

LXP will host a conference call today, May 3, 2023, at 8:30 a.m. Eastern Time, to discuss its results for the quarter ended March 31, 2023. Interested parties may participate in this conference call by dialing 1-888-660-6082 or 1-929-201-6604. Conference ID is 1576583. A replay of the call will be available through August 1, 2023, at 1-800-770-2030 or 1-647-362-9199, pin code for all replay numbers is 1576583. A link to a live webcast of the conference call is available at www.lxp.com within the Investors section.

LXP Industrial Trust (NYSE: LXP) is a publicly traded real estate investment trust (REIT) focused on single-tenant industrial real estate investments across the United States. LXP seeks to expand its industrial portfolio through acquisitions, build-to-suit transactions, sale-leaseback transactions, development projects and other transactions. For more information, including LXP's Quarterly Supplemental Information package, or to follow LXP on social media, visit 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: hgentry@lxp.com

This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under LXP's control which may cause actual results, performance or achievements of LXP to be materially different from the results, performance, or other expectations implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the headings “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in LXP's periodic reports filed with the Securities and Exchange Commission, including risks related to: (1) national, regional and local economic and political climates, (2) the outbreak of highly infectious or contagious diseases, (3) authorization by LXP's Board of Trustees of future dividend declarations, (4) LXP's ability to achieve its estimates of net income attributable to common shareholders and Adjusted Company FFO for the year ending December 31, 2023, (5) the successful consummation of any lease, acquisition, build-to-suit, disposition, financing or other transaction, including achieving any estimated yields (6) the failure to continue to qualify as a real estate investment trust, (7) changes in general business and economic conditions, including the impact of any legislation, (8) competition, (9) inflation, increases in real estate construction costs and construction schedule delays, (10) changes in financial markets and interest rates, (11) changes in accessibility of debt and equity capital markets, (12) future impairment charges, and (13) risks related to our investments in our non-consolidated joint ventures. Copies of the periodic reports LXP files with the Securities and Exchange Commission are available on LXP's web site at www.lxp.com. Forward-looking statements, which are based on certain assumptions and describe LXP's future plans, strategies and expectations, are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects”, “may,” “plans,” “predicts,” “will,” “will likely result,” “is optimistic,” “goal,” “objective” or similar expressions. Except as required by law, LXP undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that LXP's expectations will be realized.

References to LXP refer to LXP Industrial Trust and its consolidated subsidiaries. All interests in properties and loans are held, and all property operating activities are conducted, through special purpose entities, which are separate and distinct legal entities that maintain separate books and records, but in some instances are consolidated for financial statement purposes and/or disregarded for income tax purposes. The assets and credit of each special purpose entity with a property subject to a mortgage loan are not available to creditors to satisfy the debt and other obligations of any other person, including any other special purpose entity or affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member of managing member of such property owner subsidiary), but merely hold partnership, membership or beneficial interests therein which interests are subordinate to the claims of the property owner subsidiary's (or its general partner's, member's or managing member's) creditors.

Non-GAAP Financial Measures - Definitions

LXP has used non-GAAP financial measures as defined by the Securities and Exchange Commission Regulation G in this Quarterly Earnings Release and in other public disclosures.

LXP believes that the measures defined below are helpful to investors in measuring our performance or that of an individual investment. Since these measures exclude certain items which are included in their respective most comparable measures under generally accepted accounting principles (“GAAP”), reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP measures. These measures are not necessarily indications of our cash flow available to fund cash needs. Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating LXP's financial performance or cash flow from operating, investing or financing activities or liquidity.

Adjusted EBITDA: Adjusted EBITDA represents EBITDA (earnings before interest, taxes, depreciation and amortization) modified to include other adjustments to GAAP net income for gains on sales of properties, impairment charges, debt satisfaction gains (losses), net, non-cash charges, net, straight-line adjustments, non-recurring charges, the non-cash impact of sales-type leases and adjustments for pro-rata share of non-wholly owned entities. LXP's calculation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. LXP believes that net income is the most directly comparable GAAP measure to Adjusted EBITDA.

Base Rent: Base Rent is calculated by making adjustments to GAAP rental revenue to exclude billed tenant reimbursements and lease termination income and to include ancillary income. Base Rent excludes reserves/write-offs of deferred rent receivable, as applicable. LXP believes Base Rent provides a meaningful measure due to the net lease structure of leases in the portfolio.

Cash Base Rent: Cash Base Rent is calculated by making adjustments to GAAP rental revenue to remove the impact of GAAP required adjustments to rental income such as adjustments for straight-line rents related to free rent periods and contractual rent increases. Cash Base Rent excludes billed tenant reimbursements, non-cash sales-type lease income and lease termination income and includes ancillary income. LXP believes Cash Base Rent provides a meaningful indication of an investments ability to fund cash needs.

Company Funds Available for Distribution (“FAD”): FAD is calculated by making adjustments to Adjusted Company FFO (see below) for (1) straight-line adjustments, (2) lease incentive amortization, (3) amortization of above/below market leases, (4) lease termination payments, net, (5) non-cash income related to sales-type leases, (6) non-cash interest, (7) non-cash charges, net, (8) capitalized interest and internal costs, (9) cash paid for second generation tenant improvements, and (10) cash paid for second genelease costs. Although FAD may not be comparable to that of other real estate investment trusts (“REITs”), LXP believes it provides a meaningful indication of its ability to fund cash needs. FAD is a non-GAAP financial measure and should not be viewed as an alternative measurement of operating performance to net income, as an alternative to net cash flows from operating activities or as a measure of liquidity.

First Generation Costs: Represents cash spend for tenant improvements and leasing costs for in-service development projects and expenditures contemplated at acquisition for recently acquired properties. Because all companies do not calculate First Generation Costs the same way, LXP's presentation may not be comparable to similarly titled measures of other companies.

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 recognized and appropriate measure of the performance of an equity REIT. LXP believes FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.

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 does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.

LXP presents FFO available to common shareholders and unitholders - basic and also presents FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into LXP’s common shares, are converted at the beginning of the period. LXP also presents Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of LXP's real estate portfolio. LXP believes this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of LXP’s operating performance or as an alternative to cash flow as a measure of liquidity.

GAAP and Cash Yield or Capitalization Rate: GAAP and cash yields or capitalization rates are measures of operating performance used to evaluate the individual performance of an investment. These measures are estimates and are not presented or intended to be viewed as a liquidity or performance measure that present a numerical measure of LXP's historical or future financial performance, financial position or cash flows. The yield or capitalization rate is calculated by dividing the annualized NOI (as defined below, except GAAP rent adjustments are added back to rental income to calculate GAAP yield or capitalization rate) the investment is expected to generate, (or has generated) divided by the acquisition/completion cost, (or sale price). Stabilized yields assume 100% occupancy and the payment of estimated costs to achieve 100% occupancy including partner promotes, if any.

Net Operating Income (“NOI”): NOI is a measure of operating performance used to evaluate the individual performance of an investment. This measure is not presented or intended to be viewed as a liquidity or performance measure that presents a numerical measure of LXP's historical or future financial performance, financial position or cash flows. LXP defines NOI as operating revenues (rental income (less GAAP rent adjustments, non-cash income related to sales-type leases and lease termination income, net), and other property income) less property operating expenses. Other REITs may use different methodologies for calculating NOI, and accordingly, LXP's NOI may not be comparable to other companies. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. LXP believes that net income is the most directly comparable GAAP measure to NOI.

Same-Store NOI: Same-Store NOI represents the NOI for consolidated properties that were owned, stabilized and included in our portfolio for two comparable reporting periods. As Same-Store NOI excludes the change in NOI from acquired and disposed of properties, it highlights operating trends such as occupancy levels, rental rates and operating costs on properties. Other REITs may use different methodologies for calculating Same-Store NOI, and accordingly, LXP's Same-Store NOI may not be comparable to other REITs. Management believes that Same-Store NOI is a useful supplemental measure of LXP's operating performance. However, Same-Store NOI should not be viewed as an alternative measure of LXP's financial performance since it does not reflect the operations of LXP's entire portfolio, nor does it reflect the impact of general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of LXP's properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact LXP's results from operations. LXP believes that net income is the most directly comparable GAAP measure to Same-Store NOI.

Second Generation Costs: Represents cash spend for tenant improvements and leasing costs to maintain revenues at existing properties and are a component of the FAD calculation. LXP believes that second generation building improvements represent an investment in existing stabilized properties.

Stabilized Portfolio: All real estate properties other than acquired or developed properties that have not achieved 90% occupancy within one-year of acquisition or substantial completion. Non-stabilized, substantially completed development projects are classified within investments in real estate under construction.

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited and in thousands, except share and per share data)

	Three months ended March 31,
	2023				2022
Gross revenues:
Rental revenue	$	83,417			$	78,536
Other revenue		1,658				1,742
Total gross revenues		85,075				80,278
Expense applicable to revenues:
Depreciation and amortization		(45,741	)			(44,506	)
Property operating		(15,243	)			(14,616	)
General and administrative		(9,242	)			(10,737	)
Non-operating income		194				32
Interest and amortization expense		(11,393	)			(10,682	)
Impairment charges		(3,523	)			—
Change in allowance for credit loss		(79	)			—
Gains on sales of properties		7,879				255
Income before provision for income taxes and equity in earnings of non-consolidated entities		7,927				24
Provision for income taxes		(216	)			(417	)
Equity in earnings of non-consolidated entities		3,604				11,301
Net income		11,315				10,908
Less net income attributable to noncontrolling interests		(149	)			(286	)
Net income attributable to LXP Industrial Trust shareholders		11,166				10,622
Dividends attributable to preferred shares – Series C		(1,572	)			(1,572	)
Allocation to participating securities		(72	)			(61	)
Net income attributable to common shareholders	$	9,522			$	8,989
Net income attributable to common shareholders - per common share basic	$	0.03			$	0.03
Weighted-average common shares outstanding – basic		290,080,508				283,640,465
Net income attributable to common shareholders - per common share diluted	$	0.03			$	0.03
Weighted-average common shares outstanding – diluted		291,040,466				289,067,778

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited and in thousands, except share and per share data)

	March 31, 2023				December 31, 2022
Assets:
Real estate, at cost	$	3,732,558			$	3,691,066
Real estate - intangible assets		328,607				328,607
Land held for development		84,507				84,412
Investments in real estate under construction		349,827				361,924
Real estate, gross		4,495,499				4,466,009
Less: accumulated depreciation and amortization		845,338				800,470
Real estate, net		3,650,161				3,665,539
Assets held for sale		44,286				66,434
Right-of-use assets, net		22,967				23,986
Cash and cash equivalents		42,923				54,390
Restricted cash		120				116
Investments in non-consolidated entities		52,571				58,206
Deferred expenses, net		25,485				25,207
Investment in a sales-type lease, net		61,680				61,233
Rent receivable – current		4,141				3,030
Rent receivable – deferred		74,394				71,392
Other assets		26,353				24,314
Total assets	$	4,005,081			$	4,053,847
Liabilities and Equity:
Liabilities:
Mortgages and notes payable, net	$	69,288			$	72,103
Term loan payable, net		299,084				298,959
Senior notes payable, net		989,636				989,295
Trust preferred securities, net		127,719				127,694
Dividends payable		38,164				38,416
Liabilities held for sale		1,889				1,150
Operating lease liabilities		23,985				25,118
Accounts payable and other liabilities		57,170				74,261
Accrued interest payable		10,431				9,181
Deferred revenue - including below market leases, net		10,959				11,452
Prepaid rent		15,994				15,215
Total liabilities		1,644,319				1,662,844
Commitments and contingencies
Equity:
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding		94,016				94,016
Common shares, par value $0.0001 per share; authorized 600,000,000 shares,
292,557,721 and 291,719,310 shares issued and outstanding in 2023 and 2022, respectively		29				29
Additional paid-in-capital		3,320,185				3,320,087
Accumulated distributions in excess of net income		(1,105,875	)			(1,079,087	)
Accumulated other comprehensive income		14,169				17,689
Total shareholders’ equity		2,322,524				2,352,734
Noncontrolling interests		38,238				38,269
Total equity		2,360,762				2,391,003
Total liabilities and equity	$	4,005,081			$	4,053,847

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

EARNINGS PER SHARE

(Unaudited and in thousands, except share and per share data)

		Three Months Ended March 31,
		2023			2022
EARNINGS PER SHARE:
Basic:
Net income attributable to common shareholders		$	9,522		$	8,989
Weighted-average number of common shares outstanding - basic			290,080,508			283,640,465
Net income attributable to common shareholders - per common share basic		$	0.03		$	0.03
Diluted:
Net income attributable to common shareholders - basic		$	9,522		$	8,989
Impact of assumed conversions			3			—
Net income attributable to common shareholders		$	9,525		$	8,989
Weighted-average common shares outstanding - basic			290,080,508			283,640,465
Effect of dilutive securities:
Unvested share-based payment awards			127,871			1,078,891
Shares issuable under forward sales agreements			—			4,348,422
Operating partnership units			832,087			—
Weighted-average common shares outstanding - diluted			291,040,466			289,067,778
Net income attributable to common shareholders - per common share diluted		$	0.03		$	0.03

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES
ADJUSTED COMPANY FUNDS FROM OPERATIONS & COMPANY FUNDS AVAILABLE FOR DISTRIBUTION
(Unaudited and in thousands, except share and per share data)
			Three Months Ended
			March 31,
			2023				2022
FUNDS FROM OPERATIONS:
Basic and Diluted:
Net income attributable to common shareholders			$	9,522			$	8,989
Adjustments:
	Depreciation and amortization			44,860				43,850
	Impairment charges - real estate			3,523				—
	Noncontrolling interests - OP units			3				89
	Amortization of leasing commissions			881				656
	Joint venture and noncontrolling interest adjustment			2,400				3,150
	Gains on sales of properties, including our share of non-consolidated entities			(12,654	)			(11,526	)
FFO available to common shareholders and unitholders - basic				48,535				45,208
	Preferred dividends			1,572				1,572
	Amount allocated to participating securities			72				61
FFO available to all equityholders and unitholders - diluted				50,179				46,841
	Allowance for credit loss			79				—
	Transaction costs(1)			4				89
	Other non-recurring costs(2)			—				1,181
	Noncontrolling interest adjustments			(4	)			—
Adjusted Company FFO available to all equityholders and unitholders - diluted				50,258				48,111
FUNDS AVAILABLE FOR DISTRIBUTION:
Adjustments:
	Straight-line adjustments			(3,087	)			(3,502	)
	Lease incentives			96				134
	Amortization of above/below market leases			(449	)			(480	)
	Sales-type lease non-cash income			(526	)			—
	Non-cash interest			819				819
	Non-cash charges, net			2,247				2,098
	Capitalized interest and internal costs			(2,232	)			(1,166	)
	Second generation tenant improvements			(162	)			(4,232	)
	Second generation lease costs			(162	)			(141	)
	Joint venture and noncontrolling interest adjustment			(70	)			(349	)
Company Funds Available for Distribution			$	46,732			$	41,292
Per Common Share and Unit Amounts
Basic:
	FFO		$	0.17			$	0.16
Diluted:
	FFO		$	0.17			$	0.16
	Adjusted Company FFO		$	0.17			$	0.16
Basic:
	Weighted-average common shares outstanding - basic EPS			290,080,508				283,640,465
	Operating partnership units(3)			832,087				871,037
	Weighted-average common shares outstanding - basic FFO			290,912,595				284,511,502
Diluted:
	Weighted-average common shares outstanding - diluted EPS			291,040,466				289,067,778
	Operating partnership units(3)			—				871,037
	Unvested share-based payment awards			—				59,384
	Preferred shares - Series C			4,710,570				4,710,570
	Weighted-average common shares outstanding - diluted FFO			295,751,036				294,708,769

⁽¹⁾ _{Includes costs related to entering into a sales-type lease and other investment costs.}
⁽²⁾ _{Includes strategic alternatives and costs related to shareholder activism.}
⁽³⁾ _{Includes OP units other than OP units held by us.}

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
2023 EARNINGS GUIDANCE
	Twelve Months Ended December 31, 2023
	Range
Estimated:
Net income attributable to common shareholders per diluted common share(1)	$	0.18			$	0.22
Depreciation and amortization		0.66				0.66
Impact of capital transactions		(0.18	)			(0.18	)
Estimated Adjusted Company FFO per diluted common share	$	0.66			$	0.70

⁽¹⁾ _{Assumes all convertible securities are dilutive.}