2024 Q2 Form 10-Q Financial Statement

#000102537824000081 Filed on May 01, 2024

View on sec.gov

Income Statement

Concept 2024 Q2 2024 Q1
Revenue $389.7M $389.8M
YoY Change -13.9% -8.88%
Cost Of Revenue $46.50M $43.10M
YoY Change -12.16% 42569.31%
Gross Profit $343.2M $346.7M
YoY Change -14.13% -18.94%
Gross Profit Margin 88.07% 88.94%
Selling, General & Admin $33.07M $36.72M
YoY Change -2.11% 7.34%
% of Gross Profit 9.64% 10.59%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $137.5M $118.8M
YoY Change -7.53% -24.07%
% of Gross Profit 40.06% 34.26%
Operating Expenses $170.6M $155.5M
YoY Change -3.82% -18.43%
Operating Profit $172.6M $191.2M
YoY Change -22.35% -19.34%
Interest Expense -$58.67M $68.65M
YoY Change -18.78% 2.17%
% of Operating Profit -33.99% 35.9%
Other Income/Expense, Net -$7.589M -$19.00M
YoY Change -274.98% -114.78%
Pretax Income $149.1M $167.8M
YoY Change -3.64% -45.81%
Income Tax $6.219M $8.674M
% Of Pretax Income 4.17% 5.17%
Net Earnings $142.9M $159.2M
YoY Change -1.19% -45.91%
Net Earnings / Revenue 36.67% 40.85%
Basic Earnings Per Share
Diluted Earnings Per Share $0.65 $0.72
COMMON SHARES
Basic Shares Outstanding 218.8M shares 218.7M shares
Diluted Shares Outstanding 220.2M shares 220.1M shares

Balance Sheet

Concept 2024 Q2 2024 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $1.086B $777.0M
YoY Change 432.07% 425.19%
Cash & Equivalents $1.086B $777.0M
Short-Term Investments
Other Short-Term Assets
YoY Change
Inventory $7.743M $0.00
Prepaid Expenses
Receivables
Other Receivables
Total Short-Term Assets $1.094B $777.0M
YoY Change 342.61% 304.47%
LONG-TERM ASSETS
Property, Plant & Equipment $10.48B $10.45B
YoY Change -20.14% -16.89%
Goodwill $973.2M $974.1M
YoY Change -6.15% -6.14%
Intangibles
YoY Change
Long-Term Investments $356.2M $355.7M
YoY Change 4.68% 4.25%
Other Assets $143.7M $327.1M
YoY Change 74.86% 294.56%
Total Long-Term Assets $16.68B $16.83B
YoY Change -11.44% -9.69%
TOTAL ASSETS
Total Short-Term Assets $1.094B $777.0M
Total Long-Term Assets $16.68B $16.83B
Total Assets $17.77B $17.61B
YoY Change -6.85% -6.48%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $548.4M $575.8M
YoY Change -14.82% -15.25%
Accrued Expenses
YoY Change
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $742.9M $768.8M
YoY Change -15.22% -15.61%
LONG-TERM LIABILITIES
Long-Term Debt $8.102B $7.873B
YoY Change -5.96% -4.66%
Other Long-Term Liabilities $128.7M $131.5M
YoY Change -18.4% -18.74%
Total Long-Term Liabilities $8.231B $8.005B
YoY Change -6.18% -4.93%
TOTAL LIABILITIES
Total Short-Term Liabilities $742.9M $768.8M
Total Long-Term Liabilities $8.231B $8.005B
Total Liabilities $9.130B $8.932B
YoY Change -7.27% -6.1%
SHAREHOLDERS EQUITY
Retained Earnings
YoY Change
Common Stock $219.0K $219.0K
YoY Change 2.34% 2.34%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $8.633B $8.673B
YoY Change
Total Liabilities & Shareholders Equity $17.77B $17.61B
YoY Change -6.85% -6.48%

Cashflow Statement

Concept 2024 Q2 2024 Q1
OPERATING ACTIVITIES
Net Income $142.9M $159.2M
YoY Change -1.19% -45.91%
Depreciation, Depletion And Amortization $137.5M $118.8M
YoY Change -7.53% -24.07%
Cash From Operating Activities $221.0M $1.036B
YoY Change -10.73% 266.27%
INVESTING ACTIVITIES
Capital Expenditures $282.0M $213.3M
YoY Change -63.77% 19.25%
Acquisitions
YoY Change
Other Investing Activities $131.8M $693.0K
YoY Change -71.34% -162.94%
Cash From Investing Activities -$150.2M -$237.0M
YoY Change -52.82% -59.65%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 61.02M -$379.0M
YoY Change -52.46% -223.4%
NET CHANGE
Cash From Operating Activities 221.0M $1.036B
Cash From Investing Activities -150.2M -$237.0M
Cash From Financing Activities 61.02M -$379.0M
Net Change In Cash 131.9M $412.1M
YoY Change 128.92% 6059.22%
FREE CASH FLOW
Cash From Operating Activities $221.0M $1.036B
Capital Expenditures $282.0M $213.3M
Free Cash Flow -$60.95M $822.2M
YoY Change -88.52% 691.68%

Facts In Submission

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CY2023Q1 us-gaap Proceeds From Payments For Other Financing Activities
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CY2023Q1 us-gaap Payments Related To Tax Withholding For Share Based Compensation
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CY2024Q1 us-gaap Payments Of Dividends Minority Interest
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50000 usd
CY2023Q1 us-gaap Payments Of Dividends Minority Interest
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136000 usd
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0 usd
CY2023Q1 us-gaap Proceeds From Issuance Of Common Stock
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249943000 usd
CY2024Q1 us-gaap Proceeds From Minority Shareholders
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4061000 usd
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412052000 usd
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6690000 usd
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691971000 usd
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224141000 usd
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1104023000 usd
CY2023Q1 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
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230831000 usd
CY2024Q1 us-gaap Nature Of Operations
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Business and Organization<div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> </span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">W. P. Carey Inc. (“W. P. Carey”) is a REIT that, together with our consolidated subsidiaries, invests primarily in operationally-critical, single-tenant commercial real estate properties located in the United States and Northern and Western Europe that are leased on a long-term basis. We earn revenue principally by leasing the properties we own to companies on a triple-net lease basis, which generally requires each tenant to pay the costs associated with operating and maintaining the property.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Founded in 1973, our shares of common stock are listed on the New York Stock Exchange under the symbol “WPC.”</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We elected to be taxed as a REIT under Section 856 through 860 of the Internal Revenue Code effective as of February 15, 2012. As a REIT, we are not subject to federal income taxes on income and gains that we distribute to our stockholders as long as we satisfy certain requirements, principally relating to the nature of our income and the level of our distributions, as well as other factors. We also own real property in jurisdictions outside the United States through foreign subsidiaries and are subject to income taxes on our pre-tax income earned from properties in such countries.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In September 2023, we announced a plan to exit the office assets within our portfolio by (i) spinning off 59 office properties into Net Lease Office Properties (“NLOP”), so that it became a separate publicly-traded real estate investment trust (the “Spin-Off”), and (ii) implementing an asset sale program to dispose of 87 office properties retained by us (the “Office Sale Program”), which is targeted to be substantially completed in the first half of 2024.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On November 1, 2023, we completed the Spin-Off, contributing 59 office properties to NLOP. Following the closing of the Spin-Off, NLOP operates as a separate publicly-traded REIT, which we externally manage pursuant to certain advisory agreements (the “NLOP Advisory Agreements”). Through the date of this Report, we have disposed of 80 of the 87 office properties subject to the Office Sale Program (</span><span style="color:#0000ff;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%;text-decoration:underline"><a href="#i73da19c84baa4d8bb2adb623bb106dfe_85" style="color:#0000ff;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%;text-decoration:underline">Note </a><a href="#i73da19c84baa4d8bb2adb623bb106dfe_85" style="color:#0000ff;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%;text-decoration:underline">14</a></span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">).</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Effective January 1, 2024, we no longer separately analyze our business between real estate operations and investment management operations, and instead view the business as one reportable segment, since our investment management operations have been determined to be both quantitatively and qualitatively insignificant to the Company’s business. Our business is characterized as investing in operationally-critical, single-tenant commercial real estate properties that are leased on a long-term basis. These economic characteristics are similar across various property types, geographic locations, and industries in which our tenants operate and therefore considered one operating segment. The operating results of both the real estate and investment management activities are regularly reviewed, in the aggregate, by our chief operating decision maker to evaluate performance and allocate resources. Accordingly, all operations have been considered to represent one reportable segment, which are reported on our consolidated statements of income and our consolidated balance sheets. As a result of this change, we have conformed prior period segment information to reflect how we currently view our business.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Lease revenues from our real estate investments generate the vast majority of our earnings. We invest primarily in commercial properties located in the United States and Northern and Western Europe, which are leased to companies on a triple-net lease basis. At March 31, 2024, our portfolio was comprised of our full or partial ownership interests in 1,282 properties, totaling approximately 168 million square feet, substantially all of which were net leased to 335 tenants, with a weighted-average lease term of 12.2 years and an occupancy rate of 99.1%. In addition, at March 31, 2024, our portfolio was comprised of full or partial ownership interests in 96 operating properties, including 89 self-storage properties, five hotels, and two student housing properties, totaling approximately 7.3 million square feet.</span></div>
CY2024Q1 wpc Variable Interest Entities Declassified Count
VariableInterestEntitiesDeclassifiedCount
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CY2024Q1 wpc Variable Interest Entities Count
VariableInterestEntitiesCount
11 vie
CY2023Q4 wpc Variable Interest Entities Count
VariableInterestEntitiesCount
21 vie
CY2024Q1 wpc Variable Interest Entities Consolidated Count
VariableInterestEntitiesConsolidatedCount
6 vie
CY2023Q4 wpc Variable Interest Entities Consolidated Count
VariableInterestEntitiesConsolidatedCount
15 vie
CY2024Q1 wpc Variable Interest Entities Unconsolidated Count
VariableInterestEntitiesUnconsolidatedCount
5 vie
CY2023Q4 wpc Variable Interest Entities Unconsolidated Count
VariableInterestEntitiesUnconsolidatedCount
6 vie
CY2024Q1 us-gaap Prior Period Reclassification Adjustment Description
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<div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Reclassifications</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Certain prior period amounts have been reclassified to conform to the current period presentation.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Reimbursable costs from affiliates (revenues) are now included within Other advisory income and reimbursements. Reimbursable affiliate costs (expenses) are now included within General and administrative expenses. Previously, such amounts were presented in their own financial statement line items on the consolidated statements of income.</span></div>
CY2024Q1 us-gaap Revenue Recognition Leases
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<div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Revenue Recognition</span></div>There have been no significant changes in our policies for revenue from contracts under Accounting Standards Codification (“ASC”) 606 from what was disclosed in the 2023 Annual Report. ASC 606 does not apply to our lease revenues, which constitute a majority of our revenues, but primarily applies to (i) revenues generated from our hotel operating properties and (ii) investment management revenues.
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WeightedAverageNumberOfDilutedSharesOutstanding
220129870 shares
CY2023Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
212345047 shares
CY2024Q1 us-gaap Common Stock Dividends Per Share Declared
CommonStockDividendsPerShareDeclared
0.865
CY2024Q1 us-gaap Current Income Tax Expense Benefit
CurrentIncomeTaxExpenseBenefit
10000000 usd
CY2023Q1 us-gaap Current Income Tax Expense Benefit
CurrentIncomeTaxExpenseBenefit
10800000 usd
CY2024Q1 us-gaap Deferred Income Tax Expense Benefit
DeferredIncomeTaxExpenseBenefit
-1400000 usd
CY2023Q1 us-gaap Deferred Income Tax Expense Benefit
DeferredIncomeTaxExpenseBenefit
4400000 usd

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