SKT
Tanger INC
NYSE
8-K: Tanger Inc. Reports Strong 2023 Results, Expands Portfolio with New Acquisitions
Sentiment:
Quarterly Report
15 February 2024 4:07 PM
Tanger Inc. announced positive fourth quarter and full year 2023 results, highlighted by portfolio expansion and strong leasing activity.
Better than expected
The company's net income, FFO, and Core FFO all increased year-over-year, indicating improved financial performance.
Same center NOI growth of 5.4% for the quarter and 6.2% for the year exceeded expectations.
The company achieved record leasing activity with over 2.3 million square feet of leases executed in 2023.
Blended average rental rates increased by 13.3%, demonstrating strong demand for the company's properties.
Capital raise
During the fourth quarter of 2023, Tanger sold 3.4 million common shares under its ATM equity offering program at a weighted average price of $25.77 per share, generating gross proceeds of $87.3 million.
During 2023, the Company sold 3.5 million shares at a weighted average price of $25.75 per share, generating gross proceeds of $90.0 million.
As of December 31, 2023, the Company has a remaining authorization of $220.1 million under its ATM equity offering program.
Summary
- Tanger Inc. reported a net income available to common shareholders of $0.22 per share, or $23.5 million, for the fourth quarter of 2023, compared to $0.17 per share, or $18.1 million, for the same period in 2022.
- For the full year 2023, net income available to common shareholders was $0.92 per share, or $98.0 million, compared to $0.77 per share, or $81.2 million, in the prior year.
- Funds From Operations (FFO) available to common shareholders was $0.52 per share, or $58.2 million, for the fourth quarter, and $1.96 per share, or $218.4 million, for the full year.
- Core FFO available to common shareholders was also $0.52 per share, or $58.2 million, for the fourth quarter, and $1.96 per share, or $217.6 million, for the full year.
- Same center net operating income (NOI) increased by 5.4% to $91.1 million for the fourth quarter and 6.2% to $345.5 million for the full year.
- The company completed the acquisition of Tanger Outlets Asheville for $70 million and Bridge Street Town Centre for $193.5 million, and opened Tanger Outlets Nashville with a cost of approximately $145 million.
- The company executed over 2.3 million square feet of leases in 2023, a record for the company, with blended average rental rates increasing by 13.3% on a cash basis.
- Occupancy was 97.3% on December 31, 2023, compared to 97.0% on December 31, 2022.
- The company sold 3.4 million common shares under its ATM equity offering program during the fourth quarter, generating gross proceeds of $87.3 million.
- Net debt to Adjusted EBITDAre increased to 5.8x for 2023, but management estimates it would be in the range of 5.2x to 5.3x assuming a full year of Adjusted EBITDAre for Nashville and the acquisitions.
- The company has provided 2024 guidance, estimating diluted net income per share between $0.83 and $0.91, and diluted Core FFO per share between $2.02 and $2.10.
Sentiment
Score: 8
Explanation: The document presents a positive outlook with strong financial results, portfolio expansion, and positive leasing activity. While there are some minor negatives, the overall tone is optimistic and indicates a healthy business.
Positives
- The company experienced strong organic growth and executed on its external growth strategy.
- Leasing momentum continued to accelerate, with positive rent spreads and a record number of leases executed.
- The balance sheet remains well-positioned for growth.
- The company's FFO and Core FFO per share increased year-over-year.
- The company's dividend payout ratio is healthy, with a FAD payout ratio of 58% for 2023.
- Tanger has a diversified tenant mix, including leading home furnishings providers and iconic apparel brands.
Negatives
- The occupancy rate decreased slightly from 98.0% on September 30, 2023, to 97.3% on December 31, 2023, due to acquisitions.
- Average tenant sales per square foot decreased slightly to $436 for the twelve months ended December 31, 2023, compared to $444 for the twelve months ended December 31, 2022.
- Net debt to Adjusted EBITDAre increased to 5.8x for 2023, reflecting incremental spending and acquisitions.
Risks
- The company's future performance is subject to risks related to economic conditions, competition, and changes in consumer behavior.
- The company's dependence on rental income from real property and the results of operations of its retailers could adversely affect its performance.
- The company faces risks associated with debt financing and interest rate fluctuations.
- The company's forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations.
Future Outlook
Management expects full year 2024 net income per share to be between $0.83 and $0.91, and Core FFO per share to be between $2.02 and $2.10. Same Center NOI growth is projected to be between 2.0% and 4.0%.
Management Comments
- Stephen Yalof, President and Chief Executive Officer, stated that he was pleased to report another quarter of strong results, delivering robust organic growth and executing on the external growth strategy.
- Mr. Yalof also mentioned that the company will leverage the strength of its retail operating, leasing, and marketing platforms to create value in its open-air portfolio.
Industry Context
This announcement reflects a positive trend in the retail real estate sector, with Tanger demonstrating its ability to grow through both organic means and strategic acquisitions. The focus on open-air retail aligns with current consumer preferences and industry trends.
Comparison to Industry Standards
- Tanger's occupancy rate of 97.3% is strong compared to the average occupancy rates of other retail REITs, which often fluctuate between 90% and 95%.
- The company's same-center NOI growth of 6.2% for the full year is a positive indicator of operational efficiency and compares favorably to industry averages, which often range from 2% to 4%.
- The blended average rental rate increase of 13.3% is significantly higher than the industry average, indicating strong demand for Tanger's properties.
- The company's net debt to Adjusted EBITDAre ratio of 5.8x is within the acceptable range for REITs, although management's pro forma estimate of 5.2x to 5.3x is more favorable.
- Simon Property Group, a major competitor, reported a similar occupancy rate of 99.1% in their latest results, but Tanger's growth in leasing activity and rent spreads is notable.
- Macerich, another competitor, has been focusing on mixed-use developments, while Tanger is expanding its open-air portfolio, indicating different strategic approaches within the industry.
Stakeholder Impact
- Shareholders will benefit from the increased net income, FFO, and Core FFO, as well as the declared dividend.
- Employees may experience job security and potential growth opportunities due to the company's expansion.
- Customers will have access to a wider variety of shopping and dining options at the newly acquired and developed centers.
- Suppliers and creditors will benefit from the company's strong financial position and growth prospects.
Next Steps
- The company will continue to execute on its long-term growth strategies.
- Tanger will leverage its retail operating, leasing, and marketing platforms to create value in its open-air portfolio.
- The company is scheduled to participate in several upcoming industry events.
- Tanger will host a conference call to discuss its fourth quarter and full year 2023 results on February 16, 2024.
Key Dates
- October 27, 2023: Tanger Outlets Nashville opened.
- November 13, 2023: Tanger Outlets Asheville was acquired.
- November 30, 2023: Bridge Street Town Centre was acquired.
- January 2024: The company's Board of Directors declared a quarterly cash dividend of $0.26 per share.
- January 31, 2024: Record date for the quarterly cash dividend.
- February 1, 2024: Maturity date of interest rate swaps, and commencement of forward-starting swaps.
- February 15, 2024: Payment date for the quarterly cash dividend and date of the earnings release.
- February 16, 2024: Tanger will host a conference call to discuss its fourth quarter and full year 2023 results.
- February 28, 2024: Tanger is scheduled to participate in Wolfe Research's Virtual Real Estate Conference 2024.
- March 4-6, 2024: Tanger is scheduled to participate in Citi's 2024 Global Property CEO Conference.
- March 11, 2024: Tanger will host a tour of Tanger Outlets Nashville in connection with ICR's Nashville Multi-Property REIT Tour.
- March 25, 2024: Tanger will host a tour of Tanger Outlets National Harbor in connection with Evercore ISI's Multi-Property REIT Tour of Washington, DC.
- March 27, 2024: Tanger will participate in BofA's NYC Retail REIT Headquarter Tour.
Keywords
Tanger Inc., Real Estate Investment Trust, REIT, Outlet Centers, Open-Air Retail, Leasing, Occupancy, Net Operating Income, NOI, Funds From Operations, FFO, Dividend, Acquisition, Retail, Financial Results
SKT
Tanger INC
NYSE
Sector: Real Estate
Filings with Classifications
Capital raise
2 May 2025 9:08 AM
Quarterly Report
- The company has an at-the-market stock offering (ATM Offering) program, which commenced in February 2021, and replaced with a new program in February 2025, under which it may offer and sell its common shares, $0.01 par value per share, having an aggregate gross sales price of up to $400 million.
- As of March 31, 2025, we had approximately $400.0 million of common shares remaining available for sale under the ATM Offering program.
Worse than expected
2 May 2025 9:08 AM
Quarterly Report
- Net income decreased from $23.3 million to $20.0 million due to an impairment charge.
Better than expected
28 March 2025 8:46 AM
Proxy Statement
- The company's total shareholder return outperformed retail REITs, the REIT industry, and the broad market.
- Core FFO increased to $2.13 per share, or $247 million, in 2024.
- Same Center NOI grew to $333.4 million in 2024.
- Net Debt to Adjusted EBITDAre improved to 4.8x.
Capital raise
24 February 2025 4:05 PM
8-K Filing
- Tanger Inc. is establishing an at-the-market offering program to issue and sell up to $400 million of its common shares.
- The company may sell shares through sales agents, directly to them as principals, or through forward stock purchase transactions.
- The net proceeds will be used for general corporate purposes, including property development, debt repayment, and working capital.
Capital raise
21 February 2025 4:25 PM
Annual Results
- During 2024, we sold 3.4 million common shares under our at-the-market stock offering (ATM Offering) program at a weighted average price of $34.34 per share, generating gross proceeds of $115.9 million.
- In addition, we issued 1.9 million forward shares for an estimated gross value of $69.7 million based on the initial forward sale price of $36.40 with respect to each forward sale agreement.
- Shares can be settled at any time over the next 12-15 months, unless otherwise extended.
- As of December 31, 2024, we have a remaining authorization of $34.5 million under the ATM Offering.
Capital raise
19 February 2025 4:06 PM
Earnings Release
- During the fourth quarter of 2024, the Company sold 2.6 million common shares under its at-the-market stock offering program (the ATM Offering Program) at a weighted average price of $35.57 per share generating gross proceeds of $90.9 million.
- For the full year period, the Company sold 3.4 million common shares generating $115.9 million.
- Additionally, during the fourth quarter of 2024, the Company entered into forward sale agreements for 1.9 million shares at a weighted average price of $36.40 per share with total gross proceeds of approximately $69.7 million, all of which remain unsettled and can be drawn down over time.
- As of December 31, 2024, the Company had $34.5 million of common shares remaining available for sale under the ATM Offering Program.
Better than expected
19 February 2025 4:06 PM
Earnings Release
- The company's FFO and Core FFO per share increased compared to the prior year period, indicating improved operating performance.
- The company's occupancy rate increased to 98.0% compared to 97.3% in the prior year, demonstrating strong demand for its properties.
- The company's Same Center NOI increased by 3.0% for the fourth quarter and 5.1% for the full year, indicating improved profitability from its existing properties.
Worse than expected
7 November 2024 4:14 PM
Quarterly Report
- Net income decreased by approximately $3 million compared to the same quarter last year, indicating a worse performance than the prior year.
Capital raise
7 November 2024 4:14 PM
Quarterly Report
- The company issued 818,943 common shares under its at-the-market offering program, generating $25 million in gross proceeds.
- The company has approximately $195.1 million of common shares remaining available for sale under the ATM Offering program.
- In October 2024, the company issued an additional 484,741 common shares under its ATM program at an average price of $33.38 per share, totaling approximately $16.2 million of gross proceeds.
Better than expected
6 November 2024 4:08 PM
Quarterly Report
- The company increased its full-year 2024 guidance for net income, FFO, and Core FFO per share, indicating better than expected performance.
- The company achieved its 11th consecutive quarter of positive leasing spreads, demonstrating better than expected rental growth.
- Net debt to Adjusted EBITDAre improved to 5.0x, indicating better than expected financial health.
Delay expected
6 November 2024 4:08 PM
Quarterly Report
- Tanger Outlets Asheville was temporarily closed due to a lack of utilities following Hurricane Helene, causing a delay in operations.
Capital raise
6 November 2024 4:08 PM
Quarterly Report
- The company sold 0.8 million common shares under its at-the-market stock offering (the ATM Offering) at a weighted average price of $30.53 per share, generating gross proceeds of $25.0 million during the three and nine months ended September 30, 2024.
- In October 2024, the Company sold an additional 0.5 million common shares at a weighted average price of $33.38 per share, totaling approximately $16.2 million of gross proceeds.
- As of October 31, 2024, the Company had $179.0 million of common shares remaining available for sale under the ATM Offering.
Capital raise
5 August 2024 8:02 AM
Quarterly Report
- The company has an at-the-market stock offering program with approximately $220.1 million of common shares remaining available for sale.
- The company may issue equity from time to time on an opportunistic basis, dependent upon market conditions and available pricing.
Better than expected
1 August 2024 4:06 PM
Quarterly Report
- The company's results exceeded expectations due to strong leasing activity and positive rent spreads.
- The company's increased full-year guidance indicates management's confidence in continued strong performance.
- The company's same center NOI growth of 8.0% was better than expected.
Worse than expected
1 May 2024 4:55 PM
Quarterly Report
- Net income decreased by $1.6 million compared to the first quarter of 2023, indicating a worse performance than the previous year.
Capital raise
1 May 2024 4:55 PM
Quarterly Report
- The company has an at-the-market stock offering program with approximately $220.1 million of common shares remaining available for sale.
- The company may issue equity from time to time on an opportunistic basis, dependent upon market conditions and available pricing.
Better than expected
30 April 2024 4:07 PM
Quarterly Report
- The company raised its full-year 2024 guidance for net income, FFO, and Core FFO per share.
- The company achieved a 5.2% increase in same center net operating income (NOI).
- The company increased its dividend by 5.8% to $1.10 per share annually.
Better than expected
15 April 2024 9:21 AM
Credit Agreement Amendment
- The increase in borrowing capacity, extended maturity, and improved pricing grid are all better than the previous terms.
Better than expected
4 April 2024 8:46 AM
Proxy Statement
- The company's 2023 performance highlights include net income available to common shareholders of $0.92 per share, Core FFO of $1.96 per share, and 97.3% occupancy for the consolidated portfolio, all of which are better than the previous year.
Capital raise
21 February 2024 4:08 PM
Annual Report
- During 2023, the company sold 3.5 million common shares under its at-the-market stock offering (ATM Offering) program at a weighted average price of $25.75 per share, generating gross proceeds of $90.0 million.
- As of December 31, 2023, the company has a remaining authorization of $220.1 million under the ATM Offering.
- The company is a well-known seasoned issuer with a shelf registration statement on Form S-3 that allows it to register unspecified amounts of different classes of securities.
Capital raise
15 February 2024 4:07 PM
Quarterly Report
- During the fourth quarter of 2023, Tanger sold 3.4 million common shares under its ATM equity offering program at a weighted average price of $25.77 per share, generating gross proceeds of $87.3 million.
- During 2023, the Company sold 3.5 million shares at a weighted average price of $25.75 per share, generating gross proceeds of $90.0 million.
- As of December 31, 2023, the Company has a remaining authorization of $220.1 million under its ATM equity offering program.
Better than expected
15 February 2024 4:07 PM
Quarterly Report
- The company's net income, FFO, and Core FFO all increased year-over-year, indicating improved financial performance.
- Same center NOI growth of 5.4% for the quarter and 6.2% for the year exceeded expectations.
- The company achieved record leasing activity with over 2.3 million square feet of leases executed in 2023.
- Blended average rental rates increased by 13.3%, demonstrating strong demand for the company's properties.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.