Executive Summary

Solid Q2: Revenue rose year over year; Adjusted Company FFO held at $0.16/share; same-store NOI grew 4.7%. The quarter was highlighted by leasing a 1.1M sq ft development in Greenville/Spartanburg and tightening FY25 Adjusted Company FFO guidance to $0.62–$0.64/share .
Revenue vs estimates: Slight beat on revenue ($87.7M actual vs $87.25M consensus*) and EBITDA modestly below consensus*; management emphasized FFO as the key metric for REITs, with Q2 Adjusted Company FFO at $0.16/share in line with prior quarters .
Guidance: FY25 Adjusted Company FFO narrowed to $0.62–$0.64 (from $0.61–$0.65), reflecting the 1.1M sq ft lease; same-store NOI growth guidance maintained at 3%–4%; G&A outlook unchanged at $39–$41M .
Strategic actions: $39.6M asset sale at a 4.3% cash cap rate; repurchased $28.1M of Trust Preferreds at a 5% discount; net debt/Adj. EBITDA improved to 5.8x; fixed/hedged debt at 99% for 2025–2026, 3.9% W.A. rate .
Potential stock catalysts: Continued lease-up of remaining big-box developments (CFO embeds ~$2M of 2H GAAP rent in guidance) and progress toward 5.0x net debt/EBITDA target could drive multiple and NAV narrative .

What Went Well and What Went Wrong

What Went Well
- Leased 1.1M sq ft first-generation development at $5.50 PSF with 3.25% annual bumps; expected ~$3.7M 2025 contribution; stabilized cash yield ~8% .
- Same-store NOI growth +4.7% YoY; stabilized portfolio 94.1% leased (98.4% excluding first-gen vacancy) .
- Balance sheet progress: repurchased $28.1M Trust Preferreds at 5% discount; fixed/hedged 99% of 2025–2026 debt; net debt/Adj. EBITDA 5.8x; CEO: “reducing net debt to EBITDA… to five times… will help the valuation the most” .
What Went Wrong
- Two move-outs created new vacancy at quarter-end (355k sq ft Savannah; 248k sq ft Houston), though leasing activity is underway; holdover rent collected in Houston .
- Longer tenant decision timelines and macro uncertainty (tariffs/supply chain) slowing conversions despite higher inquiry activity; more concessions via free rent/TI rather than face rate cuts .
- EBITDA slightly below consensus* and continued need to lease remaining big-box inventory to unlock full $15M annual run-rate potential (CFO included only ~$2M in 2H guide) .

Financial Results

Q2 2025 vs prior periods and estimates

Metric	Q4 2024	Q1 2025	Q2 2025	Q2 2025 Cons. Est.*	Actual vs Est.
Revenue ($M)	$100.85	$88.86	$87.72	$87.25*	Beat
GAAP Diluted EPS ($)	$0.11	$0.06	$0.09	-$0.0718*	n/a (REIT EPS less comparable)
Adjusted Company FFO/share (diluted) ($)	$0.16	$0.16	$0.16	n/a	In line
Same-Store NOI Growth (%)	4.1%	5.2%	4.7%	n/a	—
EBITDA ($M)	n/a	n/a	$59.78*	$61.01*	Slight miss

Notes: Estimate values marked with * are from S&P Global; differences in EPS definitions vs REIT-reported metrics reduce comparability. Values retrieved from S&P Global.

KPIs

KPI (as of Q2 2025 unless stated)	Value
Stabilized Portfolio % Leased	94.1% (98.4% excl. first-gen vacancy)
Weighted-Average Lease Term	5.1 years
Average Annual Rent Escalation	2.8%
Weighted-Average ABR per Sq Ft	$5.14
Same-Store NOI Growth (Q2 YoY)	4.7%
Net Debt / Adjusted EBITDA	5.8x
Weighted-Average Interest Rate	3.9%

Segment/portfolio highlights (Q2)

Transaction: Sold Chillicothe, OH facility for $39.6M at 4.3% cash cap rate .
Development/Lease: 1.1M sq ft Greenville/Spartanburg leased at $5.50 PSF; cash rent begins Aug 1; ~8% stabilized cash yield .
Redevelopment: Orlando (351k sq ft; $9.4M budget) and Richmond (252k sq ft; $3.7M budget) targeting low-teens yields on cost; completion 1Q26 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Income/share (diluted)	FY2025	$0.12–$0.16	$0.13–$0.15	Narrowed (raised low end, lowered high end)
Adjusted Company FFO/share (diluted)	FY2025	$0.61–$0.65	$0.62–$0.64	Tightened (raised low end, lowered high end)
Same-Store NOI Growth	FY2025	3%–4% (maintained)	3%–4%	Maintained
G&A Expense	FY2025	$39–$41M	$39–$41M	Maintained
Common Dividend	Quarterly	$0.135/share (Q1 & Q2 declared)	$0.135/share declared for Q2	Maintained

Management noted the 1.1M sq ft lease increased the low end of FFO guidance; they also include ~ $2M of GAAP rent contribution in 2H25 from prospective leasing of remaining big boxes .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4’24 and Q1’25)	Current Period (Q2’25)	Trend
Big-box lease-up	Q1: Three large boxes active; yields ~6% at stabilization; extended 540k sq ft in Phoenix (+59% cash rent) .	Leased 1.1M sq ft at GSP; $5.50 PSF, 3.25% bumps; ~8% stabilized yield; activity picking up in Indy; slower but improving interest in Central FL .	Improving conversions; one major box leased; pipeline active.
Capital recycling/dispositions	Q4: ~$232M 2024 investment; $251.8M dispositions (2024); Q1: $35M sale; cash retained amid tariff uncertainty .	Sold OH asset at 4.3% cash cap; may “test” ~$100M of dispositions; market more resilient than feared .	Selective recycling; supportive bid for assets.
Leverage & rate hedging	Q4/Q1: Net debt/Adj. EBITDA 5.9x; swaps on term loan and trust preferreds .	Net debt/Adj. EBITDA 5.8x; 99% fixed/hedged 2025–2026; W.A. rate 3.9%; target ~5.0x over time .	Gradual deleveraging; strong interest-rate risk mitigation.
Macro/tariffs & demand	Q1: Tariff uncertainty elongating decisions; quality assets favored .	More “tire-kicking” and pauses; concessions in free rent/TI vs face rate cuts .	Demand cautious; pricing resilient; longer cycles.
Redevelopment	Q1: Richmond 252k sq ft project; mid-teens yield on ~$5M cap .	Added Orlando 351k sq ft; both projects expected low-teens yields; 1Q26 completion .	Accretive internal growth projects building.
Land bank / build-to-suit	Q1: Monitoring Phoenix/Columbus BTS interest .	Continued BTS interest; Columbus tightening; timing still protracted .	Optionality improving; timing uncertain.

Management Commentary

CEO on strategy and market health: “We produced strong second quarter results… Our performance reflects the resilience of our core business amid a continuing soft industrial real estate environment… New deliveries are at a five-year low… construction pipeline… down nearly 75% from the 2022 peak.” .
CFO on guidance drivers: “We tightened our 2025 adjusted company FFO guidance to $0.62 to $0.64… [the lease] is expected to contribute $3.7 million… We are now including approximately $2 million of GAAP rent contribution from prospective leasing activity across the remaining development facilities for the second half of the year.” .
CEO on leverage priority: “The number one priority… is generating more EBITDA from our vacancy and reducing net debt to EBITDA… If we could drive that down to five times… that will help the valuation the most.” .

Q&A Highlights

Dispositions/cap rates: The OH asset achieved a 4.3% cash cap rate by selling to a user; management may “test the market” with ~$100M more, citing resilient bid depth post “Liberation Day” .
Leasing traffic: Indy big-box activity “picked up since 4Q,” with multiple large deals in market; Central Florida slower but showing renewed interest; concessions more in free rent/TI than rent cuts .
2H25 guidance mechanics: ~$2M GAAP rent assumed from leasing across remaining big boxes; full pipeline could drive ~$15M annual run-rate (cash rent + OpEx reimbursements) when fully leased .
Redevelopment returns: Orlando ($9.4M budget) and Richmond ($3.7M) expected low-teens yields on cost; both complete 1Q26 .
Capital allocation: Share repurchase is considered, but priority is lowering net debt/EBITDA to 5x and recycling out of non-target markets (considering 1031s) .

Estimates Context

Q2 2025 revenue: $87.72M actual vs $87.25M consensus*, a slight beat .
Q2 2025 Primary EPS: GAAP diluted EPS was $0.09, while S&P Global “Primary EPS” actual printed -$0.0814 vs -$0.0718 consensus*, highlighting definitional/comparability issues for REITs; Street focus remains on FFO, which was $0.16/share .
EBITDA: $59.78M actual vs $61.01M consensus*; modest shortfall likely tied to timing of lease commencements and asset sales .

Estimate values marked with * are from S&P Global. Values retrieved from S&P Global.

Key Takeaways for Investors

Execution: The 1.1M sq ft lease materially de-risks 2025 and supports the tightened AFFO guide; further lease-up of two remaining big boxes is the next catalyst .
Balance sheet: 99% fixed/hedged debt through 2026 and 5.8x net debt/EBITDA provide rate protection and improving leverage trajectory; management targeting ~5.0x over time .
Organic growth: Same-store NOI +4.7% and portfolio MTM (management cites in-place rents below market) underpin medium-term rent growth; 97–99% year-end same-store occupancy targeted .
Capital recycling: Will selectively sell non-target assets; resilient private/user demand supports NAV; potential $100M disposition “test” could fund deleveraging or targeted reinvestment .
Risk monitor: Macro/tariff uncertainty elongates cycles; watch concession trends and 2026 retention; management still expects strong MTM and healthy renewal outcomes .
Near-term trading setup: Additional lease signings, proof of rent spreads on backfills, and visible progress toward 5.0x net debt/EBITDA are likely stock-positive catalysts .

Appendix: Source Detail and Q2 2025 Press/Filings Highlights

8-K and press release: Q2 revenue $87.7M; net income to common $27.5M ($0.09/share); Adjusted Company FFO $47.3M ($0.16/share); same-store NOI +4.7%; portfolio 94.1% leased; guidance: NI/share $0.13–$0.15, AFFO/share $0.62–$0.64 .
Transactions & balance sheet: $39.6M sale at 4.3% cash cap; repurchased $28.1M Trust Preferreds; W.A. debt rate 3.9%; net debt/Adj. EBITDA 5.8x .
Prior quarters for trend: Q1’25 revenue $88.9M; EPS $0.06; AFFO/share $0.16; same-store NOI +5.2% . Q4’24 revenue $100.9M; EPS $0.11; AFFO/share $0.16; same-store NOI +4.1% .
Q2 call: Leasing detail, guidance mechanics (~$2M GAAP rent assumed 2H), low-teens redevelopment yields, capital recycling plans, leverage target .

S&P Global estimates (for reference)

Q2 2025: Revenue consensus $87.25M* (actual $87.72M), Primary EPS consensus -$0.0718* (SPGI actual -$0.0814*), EBITDA consensus $61.01M* (SPGI actual $59.78M*)
Next quarters: Q3 2025 revenue consensus $87.11M*; Q4 2025 $86.08M* (context only)
Estimate values marked with * are from S&P Global. Values retrieved from S&P Global.

LXP Industrial Trust (LXP)·Q2 2025 Earnings Summary