FRP Holdings, Inc. (NASDAQ: FRPH) Announces Results for the First Quarter Ended March 31, 2025

JACKSONVILLE, Fla., May 12, 2025 (GLOBE NEWSWIRE) -- FRP Holdings, Inc. (NASDAQ-FRPH) --

FRP Holdings is a real estate asset developer and manager across three differing asset classes including Multifamily, Industrial and Commercial, and Mining and Royalty Lands.

Net Income Results - Net income for the first quarter of 2025 was $1,710,000 or $.09 per share versus $1,301,000 or $.07 per share in the same period last year.

Executive Summary and Analysis -- In the first quarter, the Company saw a 31% improvement in Net Income as well as a 10% increase in pro rata NOI compared to the same period last year. These improvements were driven primarily by 1) increases in mining royalty revenue and unrealized revenue; 2) improved occupancy at the Verge which drove the $988,000 improvement in equity in loss of joint venture; as well as 3) a $226,000 increase in lending venture interest income compared to the same period last year. Last quarter we cautioned our investors to temper their expectations for growth this year, especially compared to the rapid NOI growth of the previous three years. Despite the positive results from this quarter, the rationale for those tempered expectations is evident in our first quarter results. Industrial NOI was down compared to last year because of a tenant default and eviction which will take time to replace. Early in the second quarter we finished construction on our Chelsea warehouse and transferred it to the Industrial and Commercial segment from Development. This 258,000 square-foot industrial asset in Harford County, MD will have operating expenses that will further negatively impact NOI until we get it leased and occupied. The multifamily segment growth we saw this quarter will be the last bump we get from occupancy increases in the run up to stabilization. Going forward, all our multifamily assets will have been stabilized for a full year, and we expect results to be more in line with the same store growth we had this quarter, i.e. flat to slightly negative, as we compete with a glut of new projects in Washington, DC. These are temporary headwinds that may be too heavy a lift for improvements in Mining Royalties and lending venture income to offset.

Our focus in 2025 is setting the stage for our next phase of NOI growth. Part of that means leasing efforts at Cranberry and Chelsea, but primarily it means putting money to work in new projects. We have closed on the construction loans for both of our industrial JVs with Altman Logistics (f/k/a BBX) and anticipate breaking ground in the second quarter. We will continue entitlement work on our industrial pipeline in Maryland in order to be shovel ready in 2026, and we anticipate bolstering that pipeline with an additional land purchase and/or JV this year. We remain on track to deliver three new industrial assets every two years with the goal of doubling the size of our industrial segment over the next five years. As mentioned last quarter, we anticipate beginning construction this year on two multifamily projects, the first in Greenville and the second outside Ft. Myers, FL. These two projects will add 810 units and an estimated $6 million in NOI upon stabilization.

First Quarter Highlights

   -- 31% increase in Net Income ($1.7 million vs $1.3 million) 
 
   -- 10% increase in pro rata NOI ($9.4 million vs $8.5 million) 
 
   -- 3% increase in the Multifamily segment's pro rata NOI primarily due to 
      improved occupancy of The Verge. This comparison includes the results for 
      this project from the same period last year (when this project was still 
      in our Development segment) 
 
   -- 2% decrease in Industrial and Commercial segment NOI due to and eviction 
      and write-off of one tenant 
   -- 19% increase in the Mining Royalty Lands segment's NOI 

Comparative Results of Operations for the three months ended March 31, 2025 and 2024

Consolidated Results

 
(dollars in thousands)       Three Months Ended March 31, 
                           2025     2024    Change      % 
                          ------   -------  ------  ---------- 
Revenues: 
  Lease revenue          $ 7,072    7,170   $ (98)    -1.4% 
  Mining royalty and 
   rents                   3,234    2,963     271      9.1% 
                          ------   ------    ----   ------ 
Total revenues            10,306   10,133     173      1.7% 
 
Cost of operations: 
  Depreciation, 
   depletion and 
   amortization            2,607    2,535      72      2.8% 
  Operating expenses       1,859    1,867      (8)     -.4% 
  Property taxes             938      807     131     16.2% 
  General and 
   administrative          2,577    2,042     535     26.2% 
                          ------   ------    ----   ------ 
Total cost of 
 operations                7,981    7,251     730     10.1% 
 
Total operating profit     2,325    2,882    (557)   -19.3% 
 
Net investment income      2,561    2,783    (222)    -8.0% 
Interest expense            (695)    (911)    216    -23.7% 
Equity in loss of joint 
 ventures                 (2,031)  (3,019)    988    -32.7% 
Income before income 
 taxes                     2,160    1,735     425     24.5% 
Provision for income 
 taxes                       526      400     126     31.5% 
                          ------   ------    ----   ------ 
 
Net income                 1,634    1,335     299     22.4% 
Income (loss) 
 attributable to 
 noncontrolling 
 interest                    (76)      34    (110)  -323.5% 
                          ------   ------    ----   ------ 
Net income attributable 
 to the Company          $ 1,710    1,301   $ 409     31.4% 
                          ======   ======    ====   ====== 
 
 

Net income for the first quarter of 2025 was $1,710,000 or $.09 per share versus $1,301,000 or $.07 per share in the same period last year. Pro rata NOI for the first quarter of 2025 was $9,364,000 versus $8,534,000 in the same period last year. The first quarter of 2025 was impacted by the following items:

   -- Operating profit decreased 19% from higher General and administrative 
      expense and the default of an Industrial tenant. This decrease was 
      partially offset by improved results in the Multifamily and Mining 
      segments, as well as a reduction in Development professional fees. 
      General and administrative expense increased primarily due to overlapping 
      compensation as a result of the implementation of our executive 
      succession and transition plan that commenced in May, 2024. 
 
   -- Net investment income decreased $222,000 due to reduced earnings on cash 
      equivalents ($447,000) partially offset by higher income from our lending 
      ventures ($226,000) due to more residential lot sales. 
   -- Interest expense decreased $216,000 compared to the same quarter last 
      year as we capitalized $211,000 more interest this quarter. More interest 
      was capitalized due to increased in-house and joint venture projects 
      under development this quarter compared to last year. 
 
   -- Equity in loss of Joint Ventures improved $988,000 due to improved 
      results of our unconsolidated joint ventures. Results improved at The 
      Verge ($409,000) due to improved occupancy and at Bryant Street 
      ($444,000) and BC Realty ($107,000) both due to higher revenues and lower 
      variable rate interest expense. 

Multifamily Segment (Pro rata consolidated and pro rata unconsolidated)

For ease of comparison all the figures in the tables below include the results for The Verge from the same period last year (when this project was still in our Development segment).

 
                             Three months ended March 31 
(dollars in thousands)    2025        %      2024       %      Change     % 
                          -----   ---------  -----  ---------  ------  -------- 
 
Lease revenue            $8,305   100.0%     7,883  100.0%       422    5.4% 
 
Depreciation and 
 amortization             3,287    39.6%     3,305   41.9%       (18)   -.5% 
Operating expenses        2,625    31.6%     2,519   32.0%       106    4.2% 
Property taxes              970    11.7%       889   11.3%        81    9.1% 
                          -----   -----      -----  -----      -----   ---- 
 
Cost of operations        6,882    82.9%     6,713   85.2%       169    2.5% 
                          -----   -----      -----  -----      -----   ---- 
 
Operating profit before 
 G&A                     $1,423    17.1%     1,170   14.8%       253   21.6% 
                          =====   =====      =====  =====      =====   ==== 
 
Depreciation and 
 amortization             3,287              3,305               (18) 
Unrealized rents & 
 other                      (80)                14               (94) 
                          -----   ---------  -----  ---------  -----   -------- 
Net operating income     $4,630    55.7%     4,489   56.9%       141    3.1% 
                          =====   =====      =====  =====      =====   ==== 
 

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