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Sep 30, 2023
Piedmont Q3 2023 Earnings Report
Piedmont reported a net loss impacted by a goodwill impairment charge and increased interest expenses, while leasing activity remained strong.
Key Takeaways
Piedmont Office Realty Trust reported a net loss of $17 million for Q3 2023, impacted by an $11 million goodwill impairment charge and increased interest expenses. Despite the loss, the company saw a $2.9 million increase in total revenues and completed approximately 302,000 square feet of leasing transactions. The leased percentage increased to 86.7% as of September 30, 2023.
Net loss of $17.0 million, or $0.14 per diluted share, was reported, including an $11.0 million non-cash impairment charge and a $10.1 million increase in interest expense.
Core FFO per diluted share was $0.43, compared to $0.50 in Q3 2022, due to increased interest expense.
Approximately 302,000 square feet of leasing transactions were completed, with 170,000 square feet for new tenant leasing.
Leased percentage increased to 86.7% from 86.2% as of June 30, 2023.
Revenue by Segment
Forward Guidance
Due to interest rates remaining at elevated levels longer than originally anticipated, the Company estimates that it will achieve the lower end of its previously issued guidance range for the year ending December 31, 2023.
Positive Outlook
- Delivered another quarter of solid leasing results
- Increased overall leased percentage to approximately 86.7% as of the end of the quarter
- Reflects double-digit rollups in both cash and accrual rental rates.
- Addressed upcoming 2024 debt maturities
- Bolstered balance sheet as fixed rate debt now has a weighted average debt tenure of over 5 years at an average rate of approximately 5%
Challenges Ahead
- Interest rates remaining at elevated levels longer than originally anticipated
- Net income/(loss) $(19) - $(17) million
- Core FFO applicable to common stock $216 - $223 million
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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