Terrafina: Third Quarter 2023 Earnings Report

Mexico City, October 26th, 2023 – Terrafina® (“TERRA” or “the Company”) (BMV: TERRA13), a leading Mexican industrial real estate investment trust (“FIBRA”), externally advised by PGIM Real Estate and dedicated to the acquisition, development, leasing and management of industrial real estate properties in Mexico, announced today its third quarter 2023 (3Q23) earnings results.

The figures in this report have been prepared in accordance with International Financial Report Standards (“IFRS”). Figures presented in this report are expressed in millions of Mexican pesos and millions of U.S. dollars, unless stated otherwise. Additionally, figures may vary due to rounding.

 

Operating and Financial Highlights as of September 30th, 2023

OPERATING

  • As of September 30th, 2023, the occupancy rate was 98.0%, a 190-basis point increase compared to the third quarter of 2022 (3Q22).
  • Renewal rate for 3Q23 was 82.9%, a 1,691 basis-point increase compared to 3Q22.
  • Average leasing rate per square foot for 3Q23 leasing activity was US$7.16, with a 31.3% leasing spread compared to the last twelve months.
  • In 3Q23, Terrafina reported a total of 42.1 million square feet (msf) of Gross Leasable Area (GLA) comprised of 290 properties and 306 tenants.
  • 3Q23 leasing activity reached 1.3 msf, of which 34.3% corresponded to new leases, 52.4% to lease renewals, and 13.3% to early renewals. Leasing activity was concentrated in the Northern region with 65.0%, the Bajío with 22.0%, and Central region with 13.0%.

 

FINANCIAL

  • 3Q23 net collections (rental revenues – uncollected revenues + collected revenues) reached US$54.2 million, a 10.1% or US$5.0 million increase compared to 3Q22.
  • 3Q23 rental revenues reached US$54.3 million, a 12.0% or US$5.8 million increase compared to 3Q22.
  • 3Q23 NOI was US$51.1 million, a 9.2% or US$4.3 million increase compared to 3Q22.
  • The NOI margin for 3Q23 was 93.3%, a 20-basis point decrease compared to 3Q22.
  • 3Q23 EBITDA reached US$44.6 million, an 8.9% or US$3.6 million increase compared to 3Q22.
  • The EBITDA margin for 3Q23 was 81.5%, a 37-basis point decrease compared to 3Q22.
  • 3Q23 funds for operations (FFO) reached US$31.9 million, a 6.1% or US$1.8 million increase compared to 3Q22.
  • The FFO margin for 3Q23 was 58.3%, a 182-basis point decrease compared to 3Q22.
  • 3Q23 adjusted funds for operations (AFFO) reached US$26.2 million, a 1.7% or US$0.4 million increase compared to 3Q22.
  • The AFFO margin for 3Q23 was 47.4%, a 354-basis point decrease compared to 3Q22.
  • 3Q23 distributions totaled US$19.3 million. As a result, Terrafina will distribute Ps.0.4264 per CBFI (US$0.0250 per CBFI) for the July 1st to September 30th, 2023, period. Considering the average share price of US$1.91 for 3Q23 (Ps.32.56), Terrafina’s annualized dividend yield for the quarter was 5.2%.

 

Miranda Newswire – Full Press Release: Download

 
About Terrafina
Terrafina (BMV:TERRA13) is a Mexican real estate investment trust formed primarily to acquire, develop, lease and manage industrial real estate properties in Mexico. Terrafina’s portfolio consists of attractive, strategically located warehouses and other light manufacturing properties throughout the Central, Bajio and Northern regions of Mexico. It is internally managed by highly qualified industry specialists and externally advised by PGIM Real Estate.
Terrafina owns 290 real estate properties, including 286 developed industrial facilities with a collective GLA of approximately 42.1 million square feet and four land reserve parcels, designed to preserve the organic growth capability of the portfolio. Terrafina’s objective is to provide attractive risk-adjusted returns for the holders of its certificates through stable distributions and capital appreciations. Terrafina aims to achieve this objective through a successful performance of its industrial real estate and complementary properties, strategic acquisitions, access to a high level of institutional support, and an effective management and corporate governance structure. For more information, please visit www.terrafina.mx/en
 
About PGIM Real Estate
With $210 billion in gross assets under management and administration ($133 billion net)1, PGIM Real Estate provides investors and borrowers access to a range of real estate equity, real estate debt, agriculture, and impact solutions across the risk-return spectrum.
PGIM Real Estate is a business of PGIM, the global asset management business of Prudential Financial, Inc. www.prudential.com PGIM Real Estate’s risk management approach, execution capabilities and industry insights are backed by a 50-year legacy of investing in commercial real estate, a 140-year history of real estate financing,2 and the local experience of professionals in 32 cities globally. Through its investment, financing, asset management, and talent management approach, PGIM Real Estate engages in practices that strive to ignite positive environmental and social impact, while pursuing activities that seek to strengthen communities around the world. For more information visit pgimrealestate.com.
1As of June 30, 2023; AUA is $49 billion; $133 billion AUM.  
2 Includes legacy lending through PGIM’s parent company, PFI.
 
About PGIM 
PGIM is the global asset management business of Prudential Financial, Inc. (NYSE: PRU), a leading global investment manager with more than $1.27 trillion in assets under management as of June 30, 2023. With offices in 18 countries, PGIM’s businesses offer a range of investment solutions for retail and institutional investors around the world across a broad range of asset classes, including public fixed income, private fixed income, fundamental equity, quantitative equity, real estate, and alternatives. For more information about PGIM, visit pgim.com.
Prudential Financial, Inc. of the United States is not affiliated in any manner with Prudential plc, incorporated in the United Kingdom or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom. For more information please visit news.prudential.com.
 
Forward Looking Statements
This document may include forward-looking statements that may imply risks and uncertainties. Terms such as “estimate”, “project”, “plan”, “believe”, “expect”, “anticipate”, “intend”, and other similar expressions could be construed as previsions or estimates. Terrafina warns readers that declarations and estimates mentioned in this document, or realized by Terrafina’s management imply risks and uncertainties that could change in function of various factors that are out of Terrafina’s control. Future expectations reflect Terrafina’s judgment at the date of this document. Terrafina reserves the right or obligation to update the information contained in this document or derived from this document. Past or present performance is not an indicator to anticipate future performance.
 

Conference Call

Terrafina
(BMV: TERRA13)

Cordially invites you to participate in its Third Quarter 2023 Conference Call

Friday, October 27th, 2023

10:00 a.m. Mexico City Time

11:00 a.m. Central Time

12:00 p.m. Eastern Time

 

To access the call, please dial:

From within the U.S.: +1-888-506-0062
From outside the U.S.: +1-973-528-0011
Mexico Toll Free: 55-8526-2489
Conference access code: 435255
 
Audio Webcast Link:
 
To access the conference replay please dial:
U.S.: +1-877-481-4010
International (outside the U.S.): +1-919-882-2331
Replay Passcode: 49174

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