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Alpine Income Property Trust, Inc. (PINE)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered mixed results: FFO/AFFO per diluted share rose to $0.46, beating consensus, while GAAP EPS and revenue were slightly below Street expectations (FFO/AFFO); consensus details below. Guidance was raised across FFO/AFFO and investment activity, with FY 2025 FFO/AFFO now $1.82–$1.85 and investment guidance increased to $200–$230 million .
  • Operational execution remained strong: YTD investments reached $135.6 million at an 8.9% weighted-average initial cash yield, with disciplined recycling (YTD dispositions $34.3 million) and portfolio quality upgrades (48% ABR investment-grade; Lowe’s and DICK’S now top tenants) .
  • Balance sheet/liquidity: Net Debt/Pro Forma Adjusted EBITDA improved to 7.7x (from 8.1x in Q2), fixed charge coverage 3.1x, and total liquidity of $61.4 million with potential expansion to $92.7 million via unencumbered asset value .
  • Near-term catalysts: Raised FY guidance, high-yield loan originations (17%/16% loans post-quarter), an announced preferred stock offering, and a Sam’s Club acquisition that elevates Walmart to a top-5 tenant .

What Went Well and What Went Wrong

What Went Well

  • FFO/AFFO per diluted share increased to $0.46 and exceeded Street’s FFO/share consensus, reflecting better operating performance and disciplined recycling .
  • Portfolio quality improved: Investment-grade ABR at 48%, with Lowe’s and DICK’S as the top tenants; minimal lease expirations through 2026 and 8.7-year WALT support income durability .
  • Management raised FY guidance: FFO/AFFO per diluted share to $1.82–$1.85 and investment guidance to $200–$230 million, citing robust pipeline and execution on loans and property acquisitions .
    • CEO: “We produced a strong quarter… year-to-date investments… $136 million at a weighted-average initial cash yield of 8.9%” .

What Went Wrong

  • GAAP EPS and total revenue missed consensus: GAAP diluted EPS was -$0.09 vs consensus ~-$0.01; revenue of $14.563 million trailed the ~$14.666 million Street estimate, pressured by impairment and interest expense .
  • Credit-rated exposure fell: Credit-rated tenants dropped to 66% of ABR from higher levels (management attributes this to certain tenants losing ratings, e.g., Walgreens, At Home) .
  • Continued impairment and higher interest expense weighed on GAAP results: Provision for impairment was $1.915 million; interest expense $3.910 million, driving the GAAP net loss .

Financial Results

Headline P&L vs prior periods and YoY

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Total Revenues ($USD Millions)$13.480 $14.206 $14.863 $14.563
Net Income Attributable to PINE ($USD Millions)$3.080 $(1.179) $(1.641) $(1.310)
Diluted EPS (GAAP) ($USD)$0.21 $(0.08) $(0.12) $(0.09)
FFO per Diluted Share ($USD)$0.45 $0.44 $0.44 $0.46
AFFO per Diluted Share ($USD)$0.44 $0.44 $0.44 $0.46

Margins (S&P Global)

MetricQ1 2025Q2 2025Q3 2025
Net Income Margin %-8.30%*-11.04%*-9.00%*
EBITDA ($USD Millions)$10.38*$10.90*$10.80*
EBITDA Margin %73.04%*73.30%*74.17%*
Values retrieved from S&P Global.*

Revenue components (quarterly)

MetricQ1 2025Q2 2025Q3 2025
Lease Income ($USD Millions)$11.826 $12.022 $12.122
Interest Income from Commercial Loans & Investments ($USD Millions)$2.301 $2.737 $2.320
Other Revenue ($USD Millions)$0.079 $0.104 $0.121
Total Revenues ($USD Millions)$14.206 $14.863 $14.563

KPIs and Balance Sheet

KPIQ3 2025
Properties128
Occupancy99.4%
Annualized Base Rent (ABR)$46.3 million
WALT8.7 years
IG-Rated Tenants (% of ABR)48%
Net Debt / Pro Forma Adj. EBITDA7.7x
Fixed Charge Coverage Ratio3.1x
Total Liquidity$61.355 million
Dividends Declared (per share)$0.285

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
FFO per Diluted Share ($)FY 2025$1.74–$1.77 $1.82–$1.85 Raised
AFFO per Diluted Share ($)FY 2025$1.74–$1.77 $1.82–$1.85 Raised
Investments ($USD Millions)FY 2025$100–$130 $200–$230 Raised
Dispositions ($USD Millions)FY 2025$50–$70 Unchanged ($50–$70) Maintained
Weighted Avg Diluted Shares (Millions)FY 202515.5 ~15.5 Maintained
Dividend (Quarterly, $/share)Q3 2025$0.280 (Q3 2024) $0.285 Raised YoY

Management’s reconciliation from Net Loss per diluted share to FFO/AFFO supports the guidance range adjustments .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Capital recycling & portfolio upgradeRecycled assets; Walgreens reduced to 5th largest; WALT extended to 8.9 years Continued disposals (8-K: sold Kohl’s; Walgreens sale pending) and selective acquisitions (Lowe’s/DICK’S top tenants; Sam’s Club acquired post-quarter) Improving quality; de-risking
Loan program growth & funding strategy~$85.9m investments H1 with 9.1% yield; Publix land loan repaid $25.5m (funds to revolver) Post-quarter 17%/16% high-yield loans; potential A-note sales to fund; replacing maturing loans via relationships Scaling; higher-yield mix
Leverage & liquidityNet Debt/EBITDA 8.1x; liquidity $57.3m Net Debt/EBITDA improved to 7.7x; liquidity $61.4m with potential up to $92.7m Improving
Tenant credit mixIG ABR 50–51% IG ABR 48%; credit-rated ABR down to 66% as some tenants lost ratings Mixed: IG steady, ratings down
Dividend policyDividend increased to $0.285 in 2025; 65% payout Q2 Management prioritizes capital retention; any increase likely minimal due to REIT distribution requirements Conservative
External management & strategy—Affirmed strategy; focus on higher-credit big-box, no car washes; off-market Lowe’s deal Sharper focus

Management Commentary

  • CEO on quarter: “We produced a strong quarter of operational results… year-to-date investments… $136 million at a weighted-average initial cash yield of 8.9%” .
  • CEO on loan replacement risk: “I’m not worried about replacing these… we’re seeing a strong pipeline of super high-quality assets and sponsorships” .
  • CFO on funding: “There could be $50–$60 million… loan-related that’s unfunded by year-end… an A note sale prior to the end of the year would further help” .
  • CEO on portfolio tilt: “You’ll see more of the high-quality, credit, big box assets… we don’t have any car washes” .
  • CFO on credit-rated decline: “Tenants like At Home, Walgreens… dropping the credit rating altogether… caused that decrease” .

Q&A Highlights

  • Funding and leverage: Proceeds from loan repayments and potential A-note participations will recycle into new loans; leverage may tick down on the margin .
  • Loan program strategy: Management comfortable with higher-yield short-duration loans; will syndicate senior tranches opportunistically .
  • Dispositions: Continued trimming of Walgreens and dollar stores; reinvestment into higher-credit assets (e.g., Lowe’s, DICK’S) .
  • At Home exposure: Manageable; targeting replacement tenants and potential asset sales to improve cap rates .
  • Dividend stance: Retain capital to fund accretive opportunities; increases likely modest and aligned with REIT distribution rules .

Estimates Context

How Q3 2025 results compared to consensus and forward expectations:

MetricQ3 2025 ConsensusQ3 2025 ActualQ4 2025 ConsensusQ1 2026 ConsensusQ2 2026 Consensus
FFO / Share (REIT) ($)0.432*0.46 0.477*0.474*0.481*
Primary EPS (GAAP) ($)-0.0095*-0.0939 0.0416*0.0500*0.0550*
Revenue ($USD Millions)14.666*14.563 15.085*15.178*15.297*
Primary EPS - # of Estimates6*—6*4*4*
Revenue - # of Estimates7*—7*6*6*
Target Price Consensus Mean ($)17.682*—17.682*17.682*17.682*
Target Price - # of Estimates11*—11*11*11*
Values retrieved from S&P Global.*
  • Q3 takeaways: FFO/share beat, while GAAP EPS and revenue modestly missed consensus. Forward quarters imply continued incremental growth in FFO/share and revenue.*

Key Takeaways for Investors

  • Quality upgrade and guidance raise: Elevated FFO/AFFO guidance and a pivot toward higher-credit big-box tenants signal improving cash flow durability and potential multiple support .
  • Income plus yield strategy: YTD investments at ~9% initial yields and post-quarter 16–17% loan originations provide attractive cash returns; syndication of senior tranches can enhance ROE .
  • Balance sheet trajectory: Net Debt/EBITDA improved to 7.7x with liquidity that can expand; watch preferred stock issuance for funding flexibility and cost of capital .
  • Recycling continues: Expect further dispositions (Walgreens, dollar stores) and redeployment into higher-credit assets, supporting FFO growth and risk mitigation .
  • Dividend policy: Stable payout with a conservative stance on increases to preserve capital for accretive opportunities; payout ratio low 60s in Q3 .
  • Near-term catalysts: Execution on increased investment guidance, A-note sales on loans, preferred offering, and incremental IG tenant additions (e.g., Sam’s Club/Walmart exposure) .
  • Watch list: Credit-rated ABR decline due to tenant rating changes; monitor impairment and interest expense trends given GAAP EPS sensitivity .

Appendix: Additional Q3 Press Releases and Events

  • First mortgage loan on Austin luxury residential lots: $14.1 million funded at closing; 36-month term; 17% stepping to 16% and 14%; potential senior tranche sale to institutional partners .
  • Three-property portfolio acquisition: $2.8 million at an 8.5% going-in yield (Hardee’s and Jiffy Lube) .
  • Sam’s Club acquisition (post-quarter): 131,039 sq ft Houston infill; elevates Walmart to top-5 tenant .
  • Preferred stock offering announced: Series A cumulative redeemable, $25 liquidation preference; proceeds for acquisitions, loans, and debt repayment .