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Gladstone Land Corporation Reports Results For The Second Quarter Ended June 30, 2014

Stocks in this article: LAND

Please note that the limited information that follows in this press release is not adequate for making an informed investment judgment.

MCLEAN, Va., Aug. 4, 2014 (GLOBE NEWSWIRE) -- Gladstone Land Corporation (Nasdaq:LAND) (the "Company") today reported financial results for the second quarter ended June 30, 2014. A description of funds from operations ("FFO"), and Core FFO, both non-GAAP (generally accepted accounting principles in the United States) financial measures, are located at the end of this press release.  All per-share references are to fully-diluted, weighted average shares of common stock unless otherwise noted.  Please read the Company's Quarterly Report on Form 10-Q, filed today with the U.S. Securities and Exchange Commission (the "SEC"), which can be retrieved from the SEC's website at www.sec.gov or from the Company's website at www.GladstoneLand.com

Summary Information :

  For and As of the Quarters Ended    
  June 30, 2014 March 31, 2014 Change ($ / #) Change (%)
         
Operating Data:        
Total operating revenue  $ 1,565,935  $ 1,495,636  $ 70,299 4.7%
Total operating expenses  (1,208,458)  (1,100,452)  (108,006) -9.8%
Other expenses  (651,948)  (367,643)  (284,305) -77.3%
Net income before income taxes  (294,471)  27,541  (322,012) -1169.2%
Income tax provision  (6,623)  (6,623)  -- 0.0%
Net (loss) income available to common stockholders  $ (301,094)  $ 20,918  $ (322,012) -1539.4%
Real estate and intangible depreciation and amortization  330,486  288,031  42,455 14.7%
Income tax provision  6,623  6,623  --  0.0%
Acquisition-related costs  177,334  43,412  133,922 308.5%
Property and casualty loss  250,478  --   250,478 NM
Core FFO available to common stockholders  $ 463,827  $ 358,984  $ 104,843 29.2%
         
Share and Per-Share Data:        
Weighted average common shares outstanding – basic and diluted 6,530,264 6,530,264 0 0.0%
Net (loss) income per weighted average common share – basic and diluted  $ (0.05)  $ 0.00  $ (0.05) -1539.4%
Core FFO per weighted average common share – basic and diluted  0.07  0.05  0.02 31.0%
Cash dividends declared per common share  0.09  0.09  0.00 1.1%
         
Balance Sheet Data:        
Real estate and intangibles, net  $ 87,448,721  $ 75,979,461  $ 11,469,260 15.1%
Total assets  93,771,099  91,623,638  2,147,461 2.3%
Total Indebtedness  44,331,998  41,431,998 2,900,000 7.0%
Total stockholders' equity  47,056,369  47,945,186  (888,817) -1.9%
Total common shares outstanding 6,530,264 6,530,264 0 0.0%
         
Other Data:        
Farms owned 26 21 5 23.8%
Acres owned 6,439 6,000 439 7.3%
Occupancy Rate 100.0% 100.0% 0.0% 0.0%

Highlights for the Quarter :

  • New Credit Facility: Executed a new credit facility with our lender that, among other changes:
    • increased our maximum borrowing capacity by $75.0 million, or 150%, from $50.0 million up to $125.0 million;
    • extended the maturity dates, when compared to our prior mortgage note payable, by three years, to 2029, and when compared to our prior revolving line of credit, by seven years, to 2024; and
    • reduced the initial interest rate when compared to our prior line of credit by 50 bps, to 2.75%;
  • Property Acquisitions: Acquired five new farms consisting of 439 total acres for an aggregate purchase price of $11.2 million at a weighted-average cap rate of 5.3%;
  • Lease Activity: Extended the lease with the existing tenant on a property where the current lease was set to expire in December 2014 – the new lease is for six years and provides for an increase in minimum annualized GAAP straight-line rental income of 31.3% over that of the current lease;
  • Net Asset Value per Share: Our farms appreciated in value by $107,000, or $0.02 per share, due to updated valuations performed on three of our properties, as we intend to update the values of our farms on at least an annual basis; and
  • Declared Distributions : Declared and paid monthly cash distributions of $0.03 per share of common stock for each of April, May and June.

Q2 2014 Results:  Core FFO for the three months ended June 30, 2014, was approximately $464,000, or $0.07 per share, a 29.2% increase when compared to the previous quarter. Core FFO increased primarily due to the additional revenue earned on the five farms acquired this quarter, coupled with a decrease in professional fees. This increase was partially offset by an increase in interest expense due to additional borrowings during the quarter.

Net loss available to common stockholders for the three months ended June 30, 2014, was approximately $301,000, or $0.05 per share, compared to a net income available to common stockholders for the previous quarter of approximately $21,000, or $0.00 per share. This change was primarily due to a property and casualty loss we recorded during the quarter relating to two fires that damaged structures on two of our properties. Both assets were insured at the time of the fires, and at least partial recovery of the loss is considered probable. However, we are still in the process of assessing the amount expected to be recovered; thus, no offset to the loss has been recorded yet. We expect these recovery proceeds to be reflected in our financial statements next quarter. We also experienced an increase in acquisition-related costs as a result of the five farms we acquired during the quarter, as well as having a larger pipeline of deals.

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