Fibra UNO (FUNO 11) Q3 2024 earnings summary

Executive summary

• Achieved record-breaking income and NOI for the third quarter of 2024, continuing a streak of over 55 quarters with record income lines.

• Focus on total return through dividends and capital appreciation, leveraging active management and well-located real estate offered at competitive rents to a high-quality client base.

• Over 83 billion pesos distributed in dividends over 13 years, nearly matching current market cap; NAV per CBFI has grown at a 7.9% CAGR over 13 years, outpacing inflation.

• NOI per CBFI has increased over 5x since IPO, with a 13.5% CAGR, demonstrating resilience even during major crises.

• Net consolidated income for the nine months ended September 30, 2024, was $5,967.9 million pesos, down from $12,279.2 million pesos in the same period of 2023.

Financial highlights

• Revenue increased 11% year-over-year and 5.1% sequentially, reaching MXN 7.16 billion.

• Net operating income (NOI) rose 5.7% sequentially to MXN 5.412 billion, with NOI margin at 83.6% over rental revenues.

• GLA: 119.4 million sqft, 613 operations, 95.3% occupancy, average lease term of 3.9 years.

• Investment property income for the nine months ended September 30, 2024, was $18,468.8 million pesos, up from $17,003.5 million pesos year-over-year.

• FFO controlled by FUNO increased 4.3% sequentially to MXN 2.279 billion; FFO and AFFO per CBFI were MXN 0.5975, up 4.2%.

Outlook and guidance

• Management expects further improvement in income and NOI, with office and retail segments anticipated to deliver positive surprises.

• Office occupancy targeted at 83–85% by year-end, with ongoing efforts to balance rent increases and occupancy gains.

• Priority on carving out the industrial portfolio into a pure-play vehicle, with options for IPO as FIBRA or non-FIBRA.

• Nearshoring expected to positively impact all segments, driving demand for industrial, retail, and office spaces.

• IMF projects Mexico's 2024 GDP growth at 1.9%, with upgrades due to strong domestic demand and trading partner growth.