By: Mark Basch
Regency Centers Corp. reported lower third-quarter earnings last week, but the Jacksonville-based shopping center developer said trends are improving for its retail tenants as they recover from COVID-19-related shutdowns.
“We are encouraged by our meaningful progress as demonstrated by increasing cash collections and productive tenant discussions over the past few months. As of the end of October, we collected 86% of third-quarter rent,” CEO Lisa Palmer said in Regency’s Nov. 6 conference call with analysts.
By comparison, Regency reported second-quarter rent collections of 72% a month after the quarter ended.
“As tenants are able to reopen, even with capacity restrictions, they gain the visibility they need to start paying their rent or to enter into a deferral plan that both they and we can feel confident in,” Palmer said.
Regency said businesses considered “essential,” including grocers, drugstores and medical services, produced the best results, with 98% of rents collected in the quarter.
The worst performance came from full-service restaurants, with 70% of rents collected from those businesses.
The category of “other retail,” including apparel stores, had the best rebound, with rents collected rising from 55% in the second quarter to 76% in the third quarter.
Regency reported five of its centers had Stein Mart stores as of Sept. 30, including one at the South Beach Regional center in Jacksonville Beach.
Stein Mart Inc., a Jacksonville-based fashion retailer, closed all of its stores last month after filing for Chapter 11 bankruptcy Aug. 12.
Regency operates 407 retail properties across the country, most of which are anchored by supermarkets. The retail properties were 93.5% leased at the end of the third quarter.
Executive Vice President and Chief Operating Officer Jim Thompson said leasing activity is rebounding.
“We’re signing new leases in categories such as grocery, banks, beauty, restaurants and medical. Some of these leases were originated pre-COVID, but we’re also executing new deals that were initiated well into the pandemic,” he said.
Regency reported funds from operations (earnings excluding noncash charges) of 60 cents a share in the third quarter, down from 99 cents in the third quarter of 2019.
Net operating income at properties open for more than one year dropped by 15.2%.
Publix gets another COVID earnings boost
Publix Super Markets Inc.’s earnings continue to benefit from pandemic-related trends.
The Lakeland-based supermarket chain said third-quarter sales rose 18.3% to $11.1 billion and sales at stores open for more than one year rose 16.5%.
The company estimates the impact of the pandemic produced about $1.25 billion in additional sales in the quarter.
Publix’s adjusted earnings rose 44% to $836.2 million, or $1.20 a share.
Publix also said its stock price increased from $54.35 on Aug. 1 to $57.95 on Nov. 1.
The stock is not publicly traded and is made available for sale only to employees. Its price is determined by independent appraisals five times a year.
Publix has more than 225,000 employees, with 1,253 stores in seven Southeastern states.
The company’s annual report said it had about 194,000 shareholders of record, which includes former employees.
Rayonier Advanced Materials records profit
Rayonier Advanced Materials Inc. last week reported its first profit after six consecutive quarterly losses.
The Jacksonville-based maker of cellulose specialty and forest products reported third-quarter net income of $29 million, or 45 cents a share, which included $27.5 million in income tax benefits.
The company said its results benefited from strong lumber prices and signs of a recovery in viscose and high-yield pulp markets.
“Lumber markets provided a nice boost to third quarter earnings, but our team did a great job of increasing volumes to ensure that we took advantage of the stronger markets,” CEO Paul Boynton said in Rayonier AM’s conference call.
“Pulp markets are just beginning to show signs of recovery, and we remain poised to capitalize on them. In other segments like newsprint and corporate, we remain focused on controlling costs and improving our cash,” he said.
Fidelity earnings boosted by refinancing
Fidelity National Financial Inc. last week reported a big increase in third-quarter earnings, as the Jacksonville-based title insurance company benefited from increases in mortgage refinancings.
Fidelity’s adjusted earnings from continuing operations of $1.48 a share were 38 cents higher than last year’s third quarter and 23 cents higher than the consensus forecast of analysts, according to Zacks Investment Research.
“We are very pleased with our third quarter results in which we experienced sequential improvement every month in closed orders per day,” Chairman Bill Foley said in a news release.
“We benefited from the delayed spring selling season and sustained momentum in refinance. During the third quarter, refinance opened and closed orders on a daily basis increased 83% and 87%, respectively,” he said.
Fidelity’s revenue rose almost 33% to $2.98 billion after the company acquired annuity and life insurance company F&G in June. Even without F&G, title insurance revenue rose 12.7% to $2.46 billion.
F&G produced $442 million in revenue in the quarter, and Fidelity also recorded revenue from investment income.
Black Knight earnings up slightly; revenue rises
On Nov. 9, Black Knight Inc. reported third-quarter adjusted earnings of 52 cents a share, a penny higher than last year.
The Jacksonville-based mortgage technology company spun off from Fidelity said revenue rose 4.5% in the quarter to $312.6 million.
“The core fundamentals of our business remain strong and we continue to execute on our strategy to drive revenue growth by adding new clients, expanding relationships with existing clients, delivering innovative solutions and pursuing strategic acquisitions,” CEO Anthony Jabbour said in Black Knight’s conference call with analysts.
Building sale helps FRP Holdings earnings
FRP Holdings Inc. last week reported a third-quarter profit mainly because of the sale of a building in Baltimore.
The Jacksonville-based real estate development company reported earnings of $5.46 million, or 57 cents a share, after recognizing $5.7 million in gains on the sale of the industrial building and 87 acres of land in Fort Myers.
FRP said in a news release its remaining assets are performing well despite the pandemic.
“We had no issues with tenants paying rent and do not expect to. We had some concerns regarding our office tenants, but every tenant is currently paying rent and the only issue we had with back rent is one tenant who owes $6,500 for the month of April,” it said.
Chesapeake Utilities buys Western Natural Gas
Chesapeake Utilities Corp. last week said it acquired Western Natural Gas Co. in Jacksonville.
Although Chesapeake is publicly traded, the company said in a Nov. 4 news release that terms of the deal were not publicly disclosed.
But on the same day it announced the acquisition, Chesapeake reported its third-quarter earnings and said in that release it acquired assets of Western for about $6.7 million.
Western was a family-owned company that provided propane service to about 4,000 residential and commercial customers in Northeast Florida, selling about 1 million gallons of propane a year, Chesapeake said.
Sharp Energy, Chesapeake’s propane subsidiary, acquired Western.
“This is an important acquisition for our company as it enables Sharp Energy to immediately expand the availability of its propane operations into Florida and build upon our existing propane footprint,” Chesapeake CEO Jeff Householder said in the news release.
Delaware-based Chesapeake provides natural gas, propane and electricity in the mid-Atlantic states, Florida and Ohio.