Executive Summary

Q3 delivered higher AFFO and stronger cash metrics despite lower revenue YoY; AFFO rose to $2.9M ($0.07/share) vs $1.4M ($0.03) a year ago on lower interest expense, lower property costs, and higher loan interest income .
2025 AFFO guidance was raised to $0.32–$0.36 from $0.28–$0.34, signaling improved full‑year trajectory; management also expects a special dividend of $0.18–$0.22 in Jan 2026 and declared the regular $0.06 quarterly dividend .
Portfolio simplification advanced: agreement to sell Murray Wise Associates (brokerage/management) and a Series A preferred unit exchange for 23 Corn Belt properties that reduces preferred exposure by $31M upon closing; share repurchases totaled ~1.25M shares at $10.84 avg in Q3 .
Versus S&P Global consensus, revenue modestly beat and EPS was a small beat on "Primary EPS" basis: Revenue $11.32M* vs $10.59M*, Primary EPS $0.033* vs $0.03*; note company-reported basic/diluted EPS rounded to $0.00 in the 8‑K/press release . Values retrieved from S&P Global.
Potential stock reaction catalysts: guidance raise, special dividend expectation, capital structure simplification (preferred reduction and MWA sale), and ongoing buyback framework balanced against higher line‑of‑credit rates post preferred payoff .

What Went Well and What Went Wrong

What Went Well

AFFO growth and margin drivers: AFFO rose to $2.9M ($0.07/share) vs $1.4M ($0.03) on lower interest expense, lower property operating costs, and higher interest income from the FPI Loan Program .
Guidance raised: FY25 AFFO/share raised to $0.32–$0.36 from $0.28–$0.34; CFO cited stronger management fees/interest income, higher variable payments/crop sales, and updated direct operations outlook as drivers .
Strategic simplification/returns to shareholders: agreement to sell MWA and expectation for a special dividend of $0.18–$0.22; share repurchases of 1,248,802 shares at $10.84 during Q3 . CEO: “We expect to issue a special dividend … projected between $0.18 and $0.22 per share” .

What Went Wrong

Revenue and NOI declined YoY given prior-year dispositions and lower rental contribution; Total operating revenues $11.25M vs $13.32M (-15.5%), NOI $8.00M vs $9.78M (-18.2%) .
GAAP net income to common was approximately breakeven ($0.00/share) due to a small net loss available to common ($128k) and lower gains vs prior year; Q3 included a $0.5M net loss on dispositions vs $2.0M gain in prior‑year quarter .
Impairments: Q3 included $1.0M of asset impairments and management noted higher FY impairment on certain West Coast properties due to updated market info; California permanent crop impairments were a larger issue in Q2 ($16.8M) .

Financial Results

Quarterly Trend (Q1–Q3 2025)

Metric	Q1 2025	Q2 2025	Q3 2025
Total Operating Revenues ($USD Millions)	$10.252	$9.960	$11.251
Net Income to Common EPS ($)	$0.03	$0.15	$0.00
AFFO ($USD Millions)	$2.284	$1.297	$2.887
AFFO per Share ($)	$0.05	$0.03	$0.07
NOI ($USD Millions)	$8.108	$6.890	$8.000
Adjusted EBITDAre ($USD Millions)	$5.682	$4.469	$5.738

Q3 Revenue Mix and YoY

Revenue Category ($USD Millions)	Q3 2024	Q3 2025
Rental income	$9.753	$5.991
Crop sales	$2.616	$2.789
Other revenue	$0.948	$2.471
Total operating revenues	$13.317	$11.251

Q3 vs Q2 Revenue Mix (Sequential)

Revenue Category ($USD Millions)	Q2 2025	Q3 2025
Rental income	$6.024	$5.991
Crop sales	$1.439	$2.789
Other revenue	$2.497	$2.471
Total operating revenues	$9.960	$11.251

Key Balance Sheet and Cash Metrics (End of Q3)

Total debt: $170.4M
Liquidity: $172.5M (Cash $13.5M; undrawn credit $159.0M)
Shares outstanding (fully diluted, Oct 24): 43,846,568
Share repurchases: 1,248,802 shares at $10.84 avg in Q3
YTD dispositions/gain: 35 sales for $85.5M; gain on sale $24.5M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
AFFO per Share	FY 2025	$0.28–$0.34	$0.32–$0.36	Raised
Quarterly Dividend	Ongoing	$0.06 (maintained)	$0.06 (declared for Jan 15, 2026 pay date)	Maintained
Special Dividend	FY 2025 (paid Jan 2026)	N/A	$0.18–$0.22 expected	Introduced

Notes: Q2 press release indicated guidance remained unchanged vs prior quarter, corroborating the $0.28–$0.34 prior range established in Q1 .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q3 2025)	Trend
Capital returns (buybacks/special div.)	Q1: Raised FY25 guidance; modest buybacks; highlighted solar revenue and lower interest expense . Q2: Significant asset sales, buybacks, debt reduction; impairments in CA .	Expect special dividend $0.18–$0.22; continued opportunistic buybacks tied to dispositions; near‑term buybacks less likely ahead of special dividend .	More cash returned via special dividend; buybacks opportunistic.
Portfolio simplification	Q2: 32 property sales; $24.2M gains; impairments on CA properties .	Sell MWA business (closing mid-Nov) with negligible 2026 P&L impact; exchange 23 properties for $31M of Series A preferred units to reduce preferred exposure .	Continued simplification; reduced preferred overhang.
Loan program/revenue mix	Q1: Higher interest income and lower interest expense aided results . Q2: Management fees/interest income supportive; AFFO growth .	Guidance lift driven by higher management fees/interest income from extending loans; sequentially stronger crop sales; small walnut inventory acceleration (~$0.2M) .	Loan yields support AFFO while core rentals normalize lower.
Rents/renewals	Recent years saw sizable increases;	2025 renewals largely done; row‑crop rents roughly flat; using 1‑year extensions during tougher farmer economics .	Flat near term, with potential uplift if macro improves.
Legal/regulatory	—	Modest ongoing “short-and-distort” costs; new Louisiana farm dispute; slightly higher legal spend than budgeted .	Small headwind; monitored.
Macro/trade	—	Potential U.S.-China ag deal could modestly help farmer profitability, but effects likely muted and indirect to FPI (fixed cash rents) .	Cautious optimism; indirect exposure to crop prices.

Management Commentary

CEO Luca Fabbri on strategy and special dividend: “The sale of our brokerage and third-party farm management business to Peoples Company is another step in streamlining and focusing our business… we expect to issue a special dividend… projected to be between $0.18 and $0.22 per share.”
CFO Susan Landi on AFFO drivers: “AFFO was positively impacted by significantly lower interest expense… lower property operating costs, and increased interest income due to a higher average balance on loans under the FPI Loan Program.”
Executive Chairman Paul Pittman on sustainability of 2025 strength: “While we are thrilled with how strong [AFFO] is, it is based on some one-time events… next year will start out… more modest… we’ll do our best to find the one-time events next year… but you can’t promise them.”
CFO on guidance raise mechanics: Increased management fees/interest income from extended loans; variable rent/direct ops outlook improved; other income reduced on MWA sale; increased impairment offset by lower property opex and depreciation from dispositions .

Q&A Highlights

Series A preferred/asset exchange: Closing Dec 10; dividend accrual on exchanged preferred ceased Aug 1; company intends to pay off remaining preferred rather than convert in early 2026, funded by lines of credit (blended mid‑5% vs 3% preferred) .
Buybacks vs special dividend: Expect fewer buybacks near term given upcoming special dividend and elevated share price into that event; would step in if price dips; buybacks remain driven by disposition proceeds .
Loan program: Guidance increase partly from an extension of an existing high‑yield secured loan; pipeline steady .
Revenue/cost timing: ~$0.2M accelerated revenue related to sale of a California walnut property; not material .
Rent renewals: Largely completed; flat rents this cycle with 1‑year extensions to avoid locking in multi‑year terms in a tougher farmer environment .

Estimates Context

Metric	S&P Global Consensus*	Reported (S&P Actual Basis)*	Beat/Miss
Revenue ($USD Millions)	$10.59*	$11.32*	Beat
Primary EPS ($)	$0.03*	$0.033*	Beat

Values retrieved from S&P Global.
Note: Company‑reported total operating revenues were $11.251M (vs. S&P “actual” $11.315M) and basic/diluted EPS rounded to $0.00 for Q3; methodology and rounding differ from S&P “Primary EPS” presentation .

Key Takeaways for Investors

Guidance raised again; FY25 AFFO/share now $0.32–$0.36, supported by loan income, variable rents, and direct ops; watch for sustainability into 2026 as management flags some 2025 one‑time tailwinds .
Shareholder returns likely skew to a January special dividend of $0.18–$0.22 near term; buybacks remain opportunistic and tied to dispositions .
Revenue mix shift: lower rental income from dispositions offset by higher crop sales/other revenues and loan program income; near‑term rent renewals flat .
Capital structure simplification: MWA exit and preferred reduction improve focus and reduce preferred overhang, but swapping 3% preferred for mid‑5% line debt may raise interest expense run‑rate .
Watch California exposure/impairments and legal spend; impairments moderated in Q3 ($1.0M) vs Q2 but remain an area to monitor .
Macro catalyst watch: any durable improvement in farmer profitability (e.g., trade flows) could aid 2026 rent resets; exposure remains indirect given fixed‑cash leases .

Appendix: Additional Data and Disclosures

Additional Operating Metrics (Q3 2025 vs Q3 2024)

Metric	Q3 2024	Q3 2025
Net Income ($USD Millions)	$1.838	$0.491
NOI ($USD Millions)	$9.784	$8.000
Adjusted EBITDAre ($USD Millions)	$7.649	$5.738
AFFO ($USD Millions)	$1.399	$2.887
AFFO per Share ($)	$0.03	$0.07

Selected Balance Sheet (Q3 2025)

Total assets: $738.5M; Total equity: $457.3M; Total liabilities: $180.2M .
Mortgage notes and bonds payable (net): $169.8M .

All company-reported figures above are sourced from the Q3 2025 8‑K/press release and accompanying financial tables .

Farmland Partners Inc. (FPI)·Q3 2025 Earnings Summary