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KIMCO REALTY CORP (KIM)·Q1 2025 Earnings Summary

Executive Summary

  • Raised FY 2025 guidance: Net income to $0.70–$0.73 (from $0.70–$0.72) and FFO/share to $1.71–$1.74 (from $1.70–$1.72), underpinned by strong leasing, accelerated rent commencements, and better-than-expected credit loss .
  • Q1 2025 delivered broad-based strength: Revenue $536.6M, Diluted EPS $0.18, FFO/share $0.44 (+12.8% YoY), Same Property NOI +3.9%; pro-rata leased occupancy 95.8% amid targeted backfills of bankruptcy-driven vacancies .
  • Material estimate beats: Revenue, EPS, and FFO/share exceeded Wall Street consensus, with new lease cash spreads at 48.7% (7+ year high) and SNOW pipeline at ~$60M ABR driving near-term cash flow visibility .
  • Capital allocation catalysts: $500M unsecured note repaid; $58.8M buyback of 3.0M shares post-quarter at $19.61 average price; Moody’s outlook raised to Positive (Baa1) .

What Went Well and What Went Wrong

What Went Well

  • Robust demand and pricing power: Signed 583 leases for 4.4M sq ft; blended cash rent spreads 13.3%, with new leases up 48.7%—highest quarterly level in 7+ years .
  • Strong NOI and FFO growth: Same Property NOI +3.9% YoY; FFO/share rose to $0.44 (+12.8% YoY), driven by rent growth, lower credit loss (56 bps), and lease commencements .
  • Strategic wins and pipeline visibility: Achieved 85% of ABR from grocery-anchored centers; expanded SNOW pipeline to ~$60M ABR; closed $108M acquisition of Markets at Town Center (Jacksonville) sourced from structured program .

Management quote: “We leveraged Kimco’s scale… finalize multi-pack leasing agreements… This enhances our visibility into future cash flow growth and expands our pipeline of near-term rent commencements.” — Conor Flynn, CEO .

What Went Wrong

  • Occupancy dipped: Pro-rata leased occupancy declined to 95.8% (−50 bps QoQ), driven by vacates (Party City, Big Lots, undersized Walmart); management flagged a temporary 2Q dip before improvement .
  • Bankruptcy exposure and backfill timing: Resolution underway for Party City, Big Lots, JOANN; backfill CapEx ~$40–$50/ft with most cash flow timing benefiting 2026 rather than 2025 .
  • Expense pressures partly offset: Higher real estate taxes and O&M costs YoY; although insurance costs ran favorable and reimbursements were strong, recoveries include some timing effects .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$507.632 $525.397 $536.624
Diluted EPS ($USD)$0.19 $0.23 $0.18
FFO per diluted share ($USD)$0.43 $0.42 $0.44
Net Income Margin %26.8%*31.6%*24.8%*
EBITDA Margin %60.8%*59.1%*62.1%*

Values with an asterisk (*) retrieved from S&P Global.

Estimates vs ActualsQ3 2024Q4 2024Q1 2025
Revenue - Consensus ($USD Millions)$498.900*$512.635*$521.713*
Revenue - Actual ($USD Millions)$507.632 $525.397 $536.624
Primary EPS - Consensus ($USD)$0.166*$0.176*$0.164*
Primary EPS - Actual ($USD)$0.19 $0.23 $0.18
FFO/share (REIT) - Consensus ($USD)$0.407*$0.421*$0.422*
FFO/share (REIT) - Actual ($USD)$0.43 $0.42 $0.44
  • Q1 2025: Revenue, EPS, and FFO/share all beat consensus (bolded in narrative below). Values retrieved from S&P Global.
Operating KPIsQ3 2024Q4 2024Q1 2025
Same Property NOI Growth (%)3.3% 4.5% 3.9%
Pro-rata Leased Occupancy (%)96.4% 96.3% 95.8%
Small Shop Occupancy (%)91.8% 91.7% 91.7%
Anchor Occupancy (%)98.2% 98.2% 97.4%
Leased vs Economic Occupancy Spread (bps)310 270 290
Signed-Not-Open ABR Pipeline ($USD Millions)~$61.2 ~$56.0 ~$60.0
Credit Loss (% of rental rev., bps)N/A82 56
Cash Rent Spreads (Blended/New/Renewals)12.3% / 41.9% / 6.8% 11.4% / 35.4% / 6.6% 13.3% / 48.7% / 8.7%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net income per diluted shareFY 2025$0.70–$0.72 $0.70–$0.73 Raised (upper end)
FFO per diluted shareFY 2025$1.70–$1.72 $1.71–$1.74 Raised
Same Property NOI growth (pro-rata)FY 2025+2.0% or better +2.5% or better Raised
Credit loss (% of rental revenues)FY 202575–100 bps 75–100 bps Maintained
Acquisitions net of dispositionsFY 2025$100–$125M; SC cap 6–7%; SIP yield 9–10% Unchanged; 1Q actual $101M, blended 6.4% Maintained (actual blended lower)
Lease termination incomeFY 2025$6–$9M $6–$9M (1Q actual $6M) Maintained
Interest income – other (cash on balance sheet)FY 2025$6–$9M $6–$9M (1Q actual $4M) Maintained
Capital expenditures (TI/LW/LC)FY 2025$250–$300M $250–$300M Maintained
Dividend2Q 2025$0.25 declared $0.25 payable Jun 20 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q1 2025)Trend
Leasing demand & rent spreadsQ3: New lease spreads 41.9%; record occupancy . Q4: Leasing momentum, FFO +7.7% YoY; occupancy 96.3% .New lease spreads 48.7%; blended 13.3%; 583 leases; SNOW ~$60M ABR .Strengthening spreads; robust demand.
Credit loss & bankruptciesQ4: Reserve 75–100 bps; watchlist (Big Lots, Party City, Jo-Ann) .Actual 56 bps; extensive backfill progress; temporary 2Q occupancy dip expected .Improving credit loss; near-term occupancy dip.
Tariffs/macroQ4: Cautious macro backdrop . Q3: Positive fundamentals .Some deal pauses post tariff shock; buyers/sellers wait-and-see .Cautious but opportunistic.
Capital allocationQ4: ATM equity $136.3M; Waterford Lakes acquisition .$58.8M buyback of 3.0M shares; repaid $500M note; Moody’s outlook Positive .Opportunistic and balanced.
Ground leases & entitlementsQ4: New program to monetize ground leases/entitlements .Target $100–$150M disposals; recurring program year over year .Ongoing monetization pipeline.
Mixed-use densificationQ4: Achieved 12k apartment entitlements; selective activation .Ground-up projects: Gordon Plaza (Home Depot, Aldi, Chase) infra-only; North Towne Plaza (Sprouts) .Selective, capital-light activation.
Supply chain/retailer CapExQ4: N/A.Retailers front-loaded inventory; no material change in CapEx requests .Stable.

Management Commentary

  • “We started 2025 with robust momentum… delivering blended pro rata cash rent spreads of 13.3%, including remarkable new lease spreads of 48.7%.” — Conor Flynn, CEO .
  • “FFO was $301.9 million or $0.44 per diluted share… per share increase of 12.8%.” — Glenn Cohen, CFO .
  • “We kicked off the second quarter funding a $35 million senior loan… with an 8% coupon and… 65% loan-to-value… and retained ROFO.” — Ross Cooper, President & CIO .
  • “April traffic is actually up 6% year-over-year… South and Pacific Southwest slightly higher.” — David Jamieson, COO .
  • “We opportunistically repurchased 3 million common shares at an average price of $19.61… representing an FFO yield of ~9% and a 24% discount to consensus NAV.” — Glenn Cohen, CFO .

Q&A Highlights

  • Credit loss framework and watchlist: 56 bps in Q1 vs guidance reserve 75–100 bps; modeling includes potential unexpected vacates (e.g., Rite Aid, At Home ~15 bps) within reserve .
  • Buyback rationale: Executed quickly post “Liberation Day” amid valuation dislocation, balancing disposition proceeds and free cash flow; prior ATM issuance at ~$25 underscores opportunism .
  • Reimbursements/insurance: Strong recoveries aided by fixed CAM and better-than-budget insurance costs; timing helps .
  • Guidance raise drivers: Better operating metrics, SNOW commencements ahead of schedule, Party City stayed longer than budget, incremental buyback .
  • Backfill economics/timing: Party City/JOANN backfill CapEx ~$40–$50/ft; majority of cash flow ramping late 2025 into 2026; single-tenant backfills prioritized .
  • Occupancy trajectory: Anticipated 2Q economic occupancy trough (~68 bps dip) with improvement in 2H as SNOW activates .
  • Transaction market: Some pause post tariffs; evaluating best uses across acquisitions, structured investments, redevelopment, and buybacks .
  • Refinancing: Only $240.5M bond due June ‘25; lines available; 2026 maturities ($750M) begin in August .

Estimates Context

  • Q1 2025 beats: Revenue $536.6M vs $521.7M consensus; EPS $0.18 vs $0.164 consensus; FFO/share $0.44 vs $0.422 consensus — all were significant beats, supported by outsized new lease spreads and faster commencements (bold positive surprise) .
  • Prior quarters: Q4 2024 and Q3 2024 also exceeded consensus on revenue, EPS, and FFO/share, indicating estimate underappreciation of rent growth and SNOW activation cadence .

Values retrieved from S&P Global for consensus estimates.

Key Takeaways for Investors

  • Near-term cash flow visibility is stronger: ~$60M SNOW ABR with ~60% expected to commence in-year supports FY FFO lift and cushions macro volatility .
  • Bankruptcy backfills are an earnings lever: CapEx ~$40–$50/ft with meaningful rent mark-to-market; most cash flow accretes in 2026, providing medium-term growth runway .
  • Portfolio quality and scale drive spreads: New lease cash spreads at 48.7% highlight pricing power in necessity-based, grocery-anchored centers with limited new supply .
  • Balance sheet optionality remains high: Liquidity ~$2.0B; modest 2025 maturities; ratings trajectory positive; opportunistic buybacks and match-funded investments are credible capital deployment pathways .
  • Guidance risk skewed to upside if credit loss stays benign: Actual Q1 credit loss at 56 bps vs reserve of 75–100 bps suggests cushion in FFO outlook if bankruptcies resolve favorably and SNOW ramps as planned .
  • Watch retail macro but lean into catalysts: Guidance raise, buyback, Moody’s outlook upgrade, and 85% ABR from grocery-anchored assets are stock-relevant catalysts .
  • Medium-term thesis: Sustained NOI growth from rent steps and SNOW activation, disciplined capital recycling (ground leases/entitlements), and selective structured “loan-to-own” pipeline .

Bold estimates beat summary for Q1 2025:

  • Revenue beat: $536.6M vs $521.7M consensus (bold positive) .
  • EPS beat: $0.18 vs $0.164 consensus (bold positive) .
  • FFO/share beat: $0.44 vs $0.422 consensus (bold positive) .

Values retrieved from S&P Global.