WPC
W P Carey INC
NYSE
8-K: W. P. Carey Reports Solid Q4 and Full Year 2024 Results, Announces 2025 AFFO Guidance
Sentiment:
Earnings Release
11 February 2025 4:10 PM
W. P. Carey announces fourth quarter and full year 2024 financial results, highlighting record investment volume for the quarter and providing 2025 AFFO guidance.
Worse than expected
Net income attributable to W. P. Carey decreased by 67.4% in the fourth quarter compared to the same period in 2023.
Full year AFFO per diluted share decreased by 9.3% from $5.18 in 2023 to $4.70 in 2024.
Dividends declared during 2024 decreased by 14.2% compared to 2023.
Revenues, including reimbursable costs, for the 2024 full year totaled $1.58 billion, down 9.2% from $1.74 billion for the 2023 full year.
Summary
- W. P. Carey reported a net income attributable to the company of $47.0 million for the fourth quarter and $460.8 million for the full year 2024.
- Diluted earnings per share were $0.21 for the fourth quarter and $2.09 for the full year.
- Adjusted Funds From Operations (AFFO) was $1.21 per diluted share for the fourth quarter and $4.70 per diluted share for the full year.
- The company announced 2025 AFFO guidance in the range of $4.82 to $4.92 per diluted share, based on anticipated full year investment volume of between $1.0 billion and $1.5 billion.
- Investment volume for the fourth quarter reached a record $841.3 million, bringing the total for 2024 to $1.6 billion.
- Gross disposition proceeds were $118.8 million for the fourth quarter and $1.2 billion for the full year.
- Contractual same-store rent growth was 2.6% as of December 31, 2024.
- The company issued $600.0 million of 3.700% Senior Unsecured Notes due 2034.
- Subsequent to quarter end, the company repaid $450 million of 4.0% Senior Unsecured Notes due February 2025.
Sentiment
Score: 6
Explanation: The sentiment is neutral to slightly positive. While the company reported lower net income and AFFO compared to the previous year, it also highlighted record investment volume and provided positive guidance for 2025. The successful exit from the office sector is also a positive development.
Positives
- Record investment volume of $841.3 million in the fourth quarter.
- Successful exit from the office sector.
- Strong liquidity position of $2.6 billion.
- High occupancy rate of 98.6% in the net lease portfolio.
- Contractual rent escalations provide a stable income stream.
- Investment grade credit ratings from Moody's (Baa1) and S&P (BBB+).
Negatives
- Net income attributable to W. P. Carey decreased by 67.4% in the fourth quarter compared to the same period in 2023, primarily due to lower gain on sale of real estate and a mark-to-market loss on shares of Lineage.
- Full year AFFO per diluted share decreased by 9.3% from $5.18 in 2023 to $4.70 in 2024, primarily reflecting the impact of the NLOP Spin-Off and dispositions under the Office Sale Program.
- Dividends declared during 2024 decreased by 14.2% compared to 2023, reflecting the impact of the strategic exit from office assets and a lower payout ratio.
- Revenues, including reimbursable costs, for the 2024 full year totaled $1.58 billion, down 9.2% from $1.74 billion for the 2023 full year.
Risks
- Uncertainty in the broader market, particularly regarding interest rates and macroeconomic factors.
- Fluctuating interest rates could impact tenants and W. P. Carey.
- Inflation could impact tenants and W. P. Carey.
- Geopolitical crises could have material adverse effects on future results.
Future Outlook
The company expects to report AFFO of between $4.82 and $4.92 per diluted share for the 2025 full year, based on investment volume of between $1.0 billion and $1.5 billion and disposition volume of between $500 million and $1.0 billion.
Management Comments
- The fourth quarter concluded a pivotal year for W. P. Carey during which we successfully exited the office sector, setting the foundation for future growth, said Jason Fox, Chief Executive Officer.
- We finished strongly with record investment volume for the quarter, and were well-positioned to capitalize on opportunities in 2025.
- We can fund our investments this year without needing to access the equity market, achieved through accretive sales of non-core assets including self-storage operating properties which should generate a meaningful spread to our net lease investments.
- Given the uncertainty in the broader market, however, particularly over the direction of interest rates and other macroeconomic factors, our guidance reflects a measured approach, which we hope proves conservative as the year progresses.
Industry Context
W. P. Carey's focus on single-tenant net lease properties, particularly in the industrial and warehouse sectors, aligns with current industry trends favoring these asset classes due to their stability and resilience.
Comparison to Industry Standards
- W. P. Carey's occupancy rate of 98.6% is strong compared to the average occupancy rates of other net lease REITs.
- The company's investment grade credit ratings are comparable to other large, well-established REITs such as Realty Income (O) and Prologis (PLD).
- The company's diversification by tenant, industry, property type, and geography is a key differentiator compared to some of its peers that may be more concentrated in specific sectors or regions.
Stakeholder Impact
- Shareholders will be impacted by the lower net income and AFFO, as well as the reduced dividend payout.
- Employees may be impacted by the company's strategic shift away from the office sector.
- Tenants may be impacted by the company's focus on industrial and warehouse properties.
- Creditors will be impacted by the company's debt management strategy.
Next Steps
- The company will continue to focus on investing in single-tenant, industrial, warehouse, and retail properties located in the U.S. and Northern and Western Europe.
- The company will continue to execute its capital allocation strategy, including accretive sales of non-core assets.
- The company will monitor macroeconomic conditions and adjust its strategy as needed.
Key Dates
- November 1, 2023: Completion of the NLOP Spin-Off
- December 12, 2024: Company reported that its Board of Directors increased its quarterly cash dividend to $0.880 per share
- December 31, 2024: End of the fourth quarter and full year 2024
- January 15, 2025: Dividend was paid to shareholders of record as of December 31, 2024
- February 11, 2025: Earnings release date
- February 12, 2025: Live conference call and audio webcast
Keywords
WPC
W P Carey INC
NYSE
Sector: Real Estate
Filings with Classifications
Capital raise
1 May 2025 5:22 PM
Capital Raising Announcement
- W. P. Carey Inc. has entered into an Equity Sales Agreement to offer and sell shares of its common stock, with an aggregate offering price of up to $1,250,000,000.
- The shares may be offered and sold from time to time through various agents.
- W. P. Carey may also sell shares to an agent as principal for its own account.
Worse than expected
30 April 2025 4:08 PM
Quarterly Report
- Net income attributable to W. P. Carey decreased due to higher losses from foreign debt remeasurement and increased allowance for credit losses.
Better than expected
1 April 2025 5:10 PM
Credit Agreement Amendment
- The amendment extends the maturity of a significant €500 million term loan by three years, improving the company's debt maturity profile.
- It introduces the potential for lower borrowing costs through a new pricing tier linked to higher credit ratings.
- The removal of specific spread adjustments on USD SOFR and CAD CORRA borrowings offers potential interest savings.
Worse than expected
12 February 2025 4:27 PM
Annual Results
- Total revenues decreased in 2024 as compared to 2023, primarily due to lower lease revenues and lower operating property revenues.
- Net income attributable to W. P. Carey decreased in 2024 as compared to 2023, primarily due to lower gain on sale of real estate, non-cash unrealized losses recognized on investment in shares of Lineage, and the impact of the Spin-Off and the Office Sale Program.
- AFFO decreased in 2024 as compared to 2023, primarily due to the impact of the Spin-Off and Office Sale Program.
Capital raise
12 February 2025 4:27 PM
Annual Results
- The company may access the capital markets through additional debt (denominated in both U.S. dollars and euros) and equity offerings, as well as term loans and other bank debt.
- The company may use existing cash resources, available capacity under our Senior Unsecured Credit Facility, proceeds from term loans or other bank debt, proceeds from dispositions of properties (including the Office Sale Program), and the issuance of additional debt or equity securities, such as issuances of common stock through our ATM Program, in order to meet our short-term and long-term liquidity needs.
Worse than expected
11 February 2025 4:10 PM
Earnings Release
- Net income attributable to W. P. Carey decreased by 67.4% in the fourth quarter compared to the same period in 2023.
- Full year AFFO per diluted share decreased by 9.3% from $5.18 in 2023 to $4.70 in 2024.
- Dividends declared during 2024 decreased by 14.2% compared to 2023.
- Revenues, including reimbursable costs, for the 2024 full year totaled $1.58 billion, down 9.2% from $1.74 billion for the 2023 full year.
Capital raise
13 November 2024 4:28 PM
Debt Offering Announcement
- W. P. Carey Inc. is raising $600 million through the issuance of 3.700% Senior Notes due in 2034.
- The offering is being underwritten by Barclays Bank PLC, BNP PARIBAS, J.P. Morgan Securities plc, and Bank of Montreal, London Branch.
Worse than expected
30 October 2024 4:06 PM
Quarterly Report
- The company's revenue, net income, and AFFO all decreased compared to the same period last year, indicating worse than expected results.
Worse than expected
29 October 2024 4:10 PM
Quarterly Report
- The company's net income and AFFO per share decreased compared to the same quarter last year, indicating worse results.
Worse than expected
15 October 2024 6:10 AM
Current Report
- The bankruptcy filing of a major tenant is generally considered a negative event that could impact future revenue.
Worse than expected
31 July 2024 4:06 PM
Quarterly Report
- Total revenues decreased due to lower lease revenues and operating property revenue.
- Net income attributable to W. P. Carey decreased due to the impact of the spin-off, asset sales, and impairment charges.
- AFFO decreased due to the impact of the spin-off, asset sales, lease restructurings and property vacancies.
Worse than expected
30 July 2024 4:06 PM
Quarterly Report
- The company's AFFO per diluted share decreased by 14.0% compared to the same quarter last year.
- The company lowered its full-year AFFO guidance by two cents per diluted share.
- Revenues decreased by 13.9% compared to the same quarter last year.
Capital raise
28 June 2024 4:15 PM
Debt Issuance Announcement
- W. P. Carey Inc. has raised $400 million through the issuance of 5.375% Senior Notes due 2034.
- The proceeds from this offering will be used for general corporate purposes, including potential investments and debt repayment.
Capital raise
20 June 2024 4:32 PM
Debt Offering Announcement
- The document details a $400 million offering of 5.375% Senior Notes due 2034.
- The company intends to use the net proceeds for general corporate purposes, including funding potential future investments and repaying indebtedness.
Capital raise
16 May 2024 4:10 PM
Debt Offering Announcement
- W. P. Carey Inc. has raised €650 million through the issuance of 4.250% Senior Notes due 2032.
- The offering was made pursuant to the company's automatic shelf registration statement and a final prospectus supplement.
Capital raise
8 May 2024 5:25 PM
Debt Offering Announcement
- W. P. Carey Inc. is raising $650 million through the issuance of senior notes.
- The notes are being offered to the public through an underwritten offering.
- The proceeds will be used for general corporate purposes and to repay existing debt.
Capital raise
1 May 2024 4:09 PM
Quarterly Report
- The company may use the at-the-market program (ATM Program) to issue additional equity securities.
- The company may also access the capital markets through additional debt offerings.
Worse than expected
1 May 2024 4:09 PM
Quarterly Report
- The company's revenue and net income decreased year-over-year, indicating worse performance compared to the previous year.
- AFFO also decreased, which is a key metric for REIT performance, suggesting a decline in operational profitability.
Worse than expected
30 April 2024 4:04 PM
Quarterly Report
- Net income and AFFO per share were down compared to the same period last year, indicating worse results.
Capital raise
9 February 2024 4:56 PM
Annual Results
- The company may access the capital markets through additional debt and equity offerings, as well as term loans and other bank debt.
- The company may issue common stock through its ATM Program.
Worse than expected
9 February 2024 4:56 PM
Annual Results
- The company's net income from Investment Management decreased due to the cessation of fees from CPA:18 Global.
- The company's fourth quarter dividend of $0.860 per share reflects a lower payout ratio.
Worse than expected
9 February 2024 7:39 AM
Quarterly Report
- The company's AFFO per diluted share for the fourth quarter and full year 2023 decreased compared to the previous year.
- The company's 2024 AFFO guidance is lower than the 2023 full year AFFO.
- Net income attributable to W. P. Carey decreased by 31.1% in the fourth quarter of 2023 compared to the same period in 2022.
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.