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BRT Apartments Corp. (BRT)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered modest operational improvement and stronger non-GAAP earnings: FFO per diluted share rose 20% YoY to $0.30 and AFFO increased 11% YoY to $0.39, while GAAP diluted EPS loss narrowed to $(0.12) from $(0.17) .
  • Combined Portfolio NOI grew 2.2% YoY and combined revenues increased 0.9% YoY; insurance expense declined 15.5%, helping offset higher utilities, with weighted average consolidated occupancy steady at 93.7% .
  • Management reiterated a 2025 focus on stabilizing occupancy amid Sunbelt new supply, expecting better rental rate growth in 2026; balance sheet liquidity remains solid with the $40M revolver undrawn and no maturities until Q3 2025 .
  • Capital returns remain active: 78,724 shares repurchased in Q1 at $17.55 and a further 63,356 shares post-quarter at $15.84; as of April 30, 2025, $8.75M remained available for repurchases; dividend was maintained at $0.25/qtr .
  • Versus S&P Global consensus, BRT beat both EPS and revenue for Q1 2025; the narrative catalysts are improving insurance costs, disciplined occupancy stabilization, and continued capital allocation via preferred equity and repurchases (see Estimates Context). Values retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Non-GAAP earnings momentum: “FFO of $0.30 per diluted share grew 20%… AFFO of $0.39… increase of 11%” YoY, reflecting solid core operations and lower insurance costs .
  • Operating cost tailwinds: Insurance expense declined 15.5% YoY; combined operating expenses fell 0.7% YoY despite utilities rising, supporting NOI growth of 2.2% YoY .
  • Balance sheet/Liquidity: Revolving credit facility of up to $40.0M remained undrawn; no debt maturities until Q3 2025; DSCR of 1.60 for Q1 underscores manageable serviceability in current conditions .

What Went Wrong

  • GAAP profitability remains negative: Net loss attributable to common stockholders was $(2.35)M; diluted EPS remained a loss at $(0.12), reflecting pressure from interest expense and depreciation .
  • Utilities up 6.8% YoY and select markets facing occupancy/rent pressure from new supply; management expects muted rent growth through 2025 in Sunbelt markets .
  • DSCR declined vs Q4 2024 (2.09) to 1.60 in Q1 2025, highlighting tighter coverage in the quarter amid rate environment and seasonal expense mix .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$24.40 $23.97 $24.11
GAAP Diluted EPS ($USD)$(0.12) $(0.11) $(0.12)
FFO per diluted share ($USD)$0.30 $0.28 $0.30
AFFO per diluted share ($USD)$0.36 $0.37 $0.39
Margin MetricQ3 2024Q4 2024Q1 2025
EBITDA Margin %39.44%*38.96%*40.37%*
EBIT Margin %13.20%*12.46%*13.70%*
Net Income Margin %-8.90%*-8.41%*-9.59%*

Values retrieved from S&P Global.*

Key Operating KPIs (Consolidated unless noted)Q3 2024Q4 2024Q1 2025
Weighted Avg Occupancy (Consolidated)94.5% 93.7% 93.7%
Avg Monthly Rent per Occupied Unit (Consolidated)$1,363 $1,371 $1,371
Combined Revenues ($USD Millions)$29.39 $28.57 $28.65
Combined Operating Income / NOI ($USD Millions)$15.66 $15.28 $15.66
Insurance Expense (Combined) ($USD Millions)$1.46 $1.46 $1.20
Debt Service Coverage Ratio (Combined)1.32 2.09 1.60

Segment/state contribution snapshot (Q1 2025 consolidated NOI):

StateNOI ($USD Thousands)% of NOI Contribution
Tennessee$2,124 16.3%
Mississippi$2,030 15.5%
Florida$1,340 10.3%
Alabama$1,478 11.3%
Georgia$1,296 9.9%

Guidance Changes

MetricPeriodPrevious Guidance (Q4 2024)Current Guidance (Q1 2025)Change
Sunbelt rent growth trajectoryFY 2025New supply muting rent growth until at least part of 2025 New supply muting rent growth until 2026; better growth anticipated in 2026 Lowered timing (later recovery)
Portfolio strategyFY 2025Emphasize stable occupancy; disciplined capital allocation Emphasize stable occupancy; disciplined capital allocation Maintained
Expense outlook (controllable)FY 2025Modest growth vs 2023 Modest growth vs 2024 Maintained (updated base year)
Insurance expense outlookFY 2025Moderate vs 2023 Expected to decline vs 2024 Improved
Credit facilityFY 2025$40M availability; no maturities until Q3 2025 $40M availability; no maturities until Q3 2025 Maintained
Preferred equity pipelineFY 2025Pursue opportunities like 2024 transactions Pursue additional preferred equity financing opportunities Maintained
Share repurchaseThrough 2026Program extended to Dec 2026 and increased to $10M (Mar 11) As of Apr 30, $8.75M available under program Active execution; capacity remaining
DividendQuarterly$0.25 declared (Q1 2025) $0.25 declared (June 4 for July 9 pay date) Maintained

Earnings Call Themes & Trends

Note: A Q1 2025 earnings call transcript was not available in the document catalog; analysis relies on supplemental and press releases .

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
Sunbelt supply and rent growthNew supply muting growth through at least part of 2025 ; continued pressure into 2025 Rent growth muted until 2026 as supply absorbed More cautious (later recovery)
Occupancy focusEmphasis on stabilizing occupancy Emphasis on stable average occupancy Stable
Insurance costsExpected to moderate vs 2023 Expected to decline vs 2024; saw -15.5% YoY in Q1 Improving
Capital allocation (preferred equity)Deployed $18.3M at 13% all-in in 2H 2024 Pursue additional preferred equity financings in 2025 Active
Balance sheet/liquidity$40M revolver undrawn; Q3 2025 first maturities Maintained undrawn revolver; no maturities until Q3 2025 Stable

Management Commentary

  • “Combined Portfolio NOI increased 2.2% for the first quarter of 2025 compared to the prior-year period.”
  • “BRT intends to emphasize stable average occupancy within the portfolio until it can achieve a lift in rental rates.”
  • “Controllable expense growth is expected to grow modestly compared to 2024 and insurance expense is expected to decline.”
  • “The Company expects to pursue additional Preferred Equity financing opportunities… and remains patient on asset growth in the near term.”
  • “Maintained revolving credit facility of up to $40.0 million, with $0 outstanding, and maturity in September 2027.”

Q&A Highlights

An earnings call transcript for Q1 2025 was not available in our sources; no Q&A details were published. Narrative insights are drawn from the Q1 supplemental and press releases .

Estimates Context

MetricQ1 2025 ConsensusQ1 2025 Actual# of EstimatesSurprise
Primary EPS Consensus Mean ($)-0.165-0.122+0.045 (beat)
Revenue Consensus Mean ($)23,851,67024,519,0003+667,330 (beat)
Target Price Consensus Mean ($)18.5018.50——

Values retrieved from S&P Global.*

Implications:

  • BRT posted an EPS beat and a revenue beat vs consensus. The strong AFFO/FFO and lower insurance costs suggest estimates for FY 2025 operating expenses (insurance line) may drift lower, while rent growth assumptions remain constrained until 2026. Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Non-GAAP strength: AFFO ($0.39) and FFO ($0.30) improved YoY despite GAAP losses; cost discipline and insurance tailwinds are helping stabilize NOI .
  • Sunbelt supply overhang persists into 2025; management signals rental rate lift likely in 2026—position sizing should reflect a longer recovery timeline .
  • Balance sheet/liquidity: Undrawn $40M revolver and no maturities until Q3 2025 provide flexibility for preferred equity deals and selective acquisitions .
  • Capital returns: Active buybacks ($1.38M in Q1; $1.00M in April) and a maintained $0.25 dividend support total return; ~$8.75M repurchase capacity remains .
  • Cost mix watch: Utilities up 6.8% YoY; monitor whether declines in insurance continue to offset other non-controllables in 2H 2025 .
  • State exposure: Tennessee and Mississippi drive ~32% of consolidated NOI; portfolio concentration in Southeastern U.S. and Texas merits close tracking of local supply/demand dynamics .
  • Near-term trading: Potential positive drift from beats and improving insurance costs, but muted rent growth and GAAP losses may cap upside until leasing conditions normalize; catalysts include incremental preferred equity deployments and further buyback execution .

Sources: Q1 2025 8-K supplemental (Exhibit 99.1), press releases and prior quarter supplementals . Values retrieved from S&P Global.*