EastGroup Properties Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>EastGroup Properties Inc. has filed its Q1 2024 10-Q report, detailing financial performance and corporate history.</b>

AI Summary

EASTGROUP PROPERTIES INC (EGP) filed a Quarterly Report (10-Q) with the SEC on April 24, 2024. EastGroup Properties Inc. filed a 10-Q report for the period ending March 31, 2024. The filing covers the first quarter of 2024. The company's principal executive offices are located in Ridgeland, MS. EastGroup Properties Inc. was formerly known as EastGroup Properties II Inc. and ICM Realty. The report includes financial data for the periods ending March 31, 2024, December 31, 2023, and March 31, 2023.

Why It Matters

For investors and stakeholders tracking EASTGROUP PROPERTIES INC, this filing contains several important signals. This 10-Q filing provides investors with the latest quarterly financial statements and operational updates for EastGroup Properties Inc., crucial for assessing the company's performance and outlook. Understanding the historical company name changes and the specific reporting periods covered is essential for tracking the company's evolution and comparing financial data accurately over time.

Risk Assessment

Risk Level: low — EASTGROUP PROPERTIES INC shows low risk based on this filing. The filing is a standard 10-Q report, which is routine for publicly traded companies and does not indicate any unusual or high-risk events.

Analyst Insight

Review the detailed financial statements within the 10-Q to understand EastGroup Properties Inc.'s current financial health and operational performance.

Key Numbers

• 2024-03-31 — Report Date (Conformed Period of Report)
• 2024-04-24 — Filing Date (Filed As Of Date)
• 2024-01-01 — Quarter Start Date (Reporting period start date)
• 2024-03-31 — Quarter End Date (Reporting period end date)

Key Players & Entities

• EASTGROUP PROPERTIES INC (company) — Filer name
• 0000049600 (company) — Central Index Key
• 6798 (company) — Standard Industrial Classification
• 132711135 (company) — IRS Number
• MD (company) — State of Incorporation
• Ridgeland, MS (company) — Business Address City/State
• EastGroup Properties II Inc. (company) — Former Company Name
• ICM Realty (company) — Former Company Name

FAQ

Industry Context

EastGroup Properties Inc. operates as a Real Estate Investment Trust (REIT) within the real estate sector, focusing on industrial and distribution properties.

Regulatory Implications

As a publicly traded company, EastGroup Properties Inc. is subject to SEC regulations, including the requirement to file quarterly reports (10-Q) to disclose financial and operational information.

What Investors Should Do

1. Analyze the financial statements for revenue, net income, and other key performance indicators.
2. Examine any disclosed risk factors or management discussions for potential business challenges.
3. Compare the current quarter's performance against historical data and industry benchmarks.

Year-Over-Year Comparison

This filing represents the first quarterly report for the fiscal year 2024, providing updated financial information compared to the previous year's filings.

Key Financial Figures

• $0.0001 — ange on which registered Common stock, $0.0001 par value per share EGP New York Stock

Filing Documents

• egp-20240331.htm (10-Q) — 1176KB
• exhibit311q12024.htm (EX-31.1) — 10KB
• exhibit312q12024.htm (EX-31.2) — 10KB
• exhibit321q12024.htm (EX-32.1) — 4KB
• exhibit322q12024.htm (EX-32.2) — 4KB
• egp-20240331_g1.jpg (GRAPHIC) — 29KB
• 0000049600-24-000065.txt (&nbsp;) — 6237KB
• egp-20240331.xsd (EX-101.SCH) — 51KB
• egp-20240331_cal.xml (EX-101.CAL) — 65KB
• egp-20240331_def.xml (EX-101.DEF) — 182KB
• egp-20240331_lab.xml (EX-101.LAB) — 545KB
• egp-20240331_pre.xml (EX-101.PRE) — 343KB
• egp-20240331_htm.xml (XML) — 883KB

Financial Statements

Financial Statements Consolidated Balance Sheets, March 31, 2024 and December 31, 2023 (unaudited) 4 Consolidated Statements of Income and Comprehensive Income for the three months ended March 31, 2024 and 2023 (unaudited) 5 Consolidated Statements of Changes in Equity for the three months ended March 31, 2024 and 2023 (unaudited) 6 Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023 (unaudited) 7

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 8 Item 2.

Management's Discussion and Analysis of Financial Condition

Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 38 Item 4.

Controls and Procedures

Controls and Procedures 39 PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 39 Item 1A.

Risk Factors

Risk Factors 39 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 39 Item 3. Defaults Upon Senior Securities 39 Item 4. Mine Safety Disclosures 39 Item 5. Other Information 40 Item 6. Exhibits 41

SIGNATURES

SIGNATURES Authorized signatures 42 -3-

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION.

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS. EASTGROUP PROPERTIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA) (UNAUDITED) March 31, 2024 December 31, 2023 ASSETS Real estate properties $ 4,927,921 4,853,548 Development and value-add properties 670,250 639,647 5,598,171 5,493,195 Less accumulated depreciation ( 1,299,905 ) ( 1,273,723 ) 4,298,266 4,219,472 Unconsolidated investment 7,816 7,539 Cash and cash equivalents 15,625 40,263 Other assets 255,298 251,939 TOTAL ASSETS $ 4,577,005 4,519,213 LIABILITIES AND EQUITY LIABILITIES Unsecured bank credit facilities, net of debt issuance costs $ ( 1,281 ) ( 1,520 ) Unsecured debt, net of debt issuance costs 1,676,573 1,676,347 Accounts payable and accrued expenses 155,255 146,337 Other liabilities 87,099 89,415 Total Liabilities 1,917,646 1,910,579 EQUITY Stockholders' Equity: Common shares; $ 0.0001 par value; 70,000,000 shares authorized; 48,010,613 shares issued and outstanding at March 31, 2024 and 47,700,432 at December 31, 2023 5 5 Excess shares; $ 0.0001 par value; 30,000,000 shares authorized; zero shares issued — — Additional paid-in capital 2,997,210 2,949,907 Distributions in excess of earnings ( 368,954 ) ( 366,473 ) Accumulated other comprehensive income 30,782 24,888 Total Stockholders' Equity 2,659,043 2,608,327 Noncontrolling interest in joint ventures 316 307 Total Equity 2,659,359 2,608,634 TOTAL LIABILITIES AND EQUITY $ 4,577,005 4,519,213 See accompanying Notes to Consolidated Financial Statements (unaudited). -4- EASTGROUP PROPERTIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) Three Months Ended March 31, 2024 2023 REVENUES Income from real estate operations $ 154,074 133,964 Other revenue 150 1,061 154,224 135,025 EXPENSES Expenses from real estate operations 43,003 36,186 Depreciation and amortization 45,169 41

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (1) BASIS OF PRESENTATION The accompanying unaudited financial statements of EastGroup Properties, Inc. ("EastGroup" or "the Company") have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In management's opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The financial statements should be read in conjunction with the financial statements contained in the Company's annual report on Form 10-K for the year ended December 31, 2023 and the notes thereto. (2) PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of EastGroup, its wholly owned subsidiaries and the investee of any joint ventures in which the Company has a controlling interest. As of March 31, 2024 and December 31, 2023, EastGroup had a 95 % controlling interest in a joint venture arrangement owning 6.5 acres of land in San Diego, known by the Company as Miramar Land. During the year ended December 31, 2023, a joint venture, in which EastGroup owns a 99.5 % interest, acquired 29.3 acres of land in Denver, known by the Company as Arista 36 Business Park 1-3. As of March 31, 2024 and December 31, 2023, EastGroup continued to hold a controlling interest in these two joint venture arrangements. The Company records 100% of the assets, liabilities, revenues and expenses of the buildings and land held in joint ventures with the noncontrolling interests provided for in accordance with the joint venture agreements. The equity method of accounting is used for the Company's 50 % undivided tenant-in-common interest in Industry Distribution Center 2. All significant intercompan

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Depreciation of buildings and other improvements is computed using the straight-line method over estimated useful lives of generally 40 years for buildings and 3 to 15 years for improvements. Building improvements are capitalized, while maintenance and repair expenses are charged to expense as incurred. Significant renovations and improvements that improve or extend the useful life of the assets are capitalized. Depreciation expense was $ 37,205,000 and $ 33,846,000 for the three months ended March 31, 2024 and 2023, respectively. The Company's Real estate properties and Development and value-add properties at March 31, 2024 and December 31, 2023 were as follows: March 31, 2024 December 31, 2023 (In thousands) Real estate properties: Land $ 835,795 814,364 Buildings and building improvements 3,382,163 3,336,615 Tenant and other improvements 692,300 684,573 Right of use assets — Ground leases (operating) (1) 17,663 17,996 Development and value-add properties (2) 670,250 639,647 5,598,171 5,493,195 Less accumulated depreciation ( 1,299,905 ) ( 1,273,723 ) $ 4,298,266 4,219,472 (1) EastGroup applies the principles of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 842, Leases, and its related Accounting Standards Updates ("ASUs") to account for its ground leases, which are classified as operating leases. The related operating lease liabilities for ground leases are included in Other liabilities on the Consolidated Balance Sheets. (2) Value-add properties are defined in Note 6. (6) DEVELOPMENT AND VALUE-ADD PROPERTIES Development and value-add properties consists of properties in lease-up, under construction, and prospective development (primarily land). Value-add properties are defined as properties that are either acquired but not stabilized or can be converted to a higher and better use. Acquired properties meeting either of the following two condit

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) therefore, the acquisitions are not considered to be acquisitions of a business. As a result, the Company capitalized acquisition costs related to its 2023 and 2024 acquisitions. The FASB Codification also provides guidance on how to properly determine the allocation of the purchase price among the individual components of both the tangible and intangible assets based on their respective fair values. The allocation to tangible assets (land, building and improvements) is based upon management's determination of the value of the property as if it were vacant using discounted cash flow models. Land is valued using comparable land sales specific to the applicable market, provided by a third party. The Company determines whether any financing assumed is above or below market based upon comparison to similar financing terms for similar properties. The cost of the properties acquired may be adjusted based on indebtedness assumed from the seller that is determined to be above or below market rates. The purchase price is also allocated among the following categories of intangible assets: the above or below market component of in-place leases and the value of leases in-place at the time of acquisition. The value allocable to the above or below market component of an acquired in-place lease is determined based upon the present value (using a discount rate reflecting the risks associated with the acquired leases) of the difference between (i) the contractual amounts to be paid pursuant to the lease over its remaining term and (ii) management's estimate of the amounts that would be paid using current market rents over the remaining term of the lease. The amounts allocated to above and below market lease intangibles are included in Other assets and Other liabilities , respectively, on the Consolidated Balance Sheets and are amortized to rental income over the remaining terms of the respective leases. In-place lease inta

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) The following table summarizes the allocation of the total consideration for the acquired assets and assumed liabilities in connection with the acquisition identified in the table above which was acquired during the three months ended March 31, 2024. ACQUIRED ASSETS AND ASSUMED LIABILITIES IN 2024 Cost (In thousands) Land $ 18,855 Buildings and building improvements 31,003 Tenant and other improvements 2,208 Total real estate properties acquired 52,066 In-place lease intangibles (1) 2,714 Above market lease intangibles (1) 121 Below market lease intangibles (2) ( 42 ) Total assets acquired, net of liabilities assumed $ 54,859 (1) In-place lease intangibles and above market lease intangibles are each included in Other assets on the Consolidated Balance Sheets. These costs are amortized over the remaining terms of the associated leases in place at the time of acquisition. (2) Below market lease intangibles are included in Other liabilities on the Consolidated Balance Sheets. These costs are amortized over the remaining terms of the associated leases in place at the time of acquisition. The leases in the property acquired during the three months ended March 31, 2024 had a weighted average remaining lease term at acquisition of approximately 6.2 years. Also during the three months ended March 31, 2024, EastGroup purchased 34.3 acres of development land in Atlanta for $ 3,302,000 . During 2023, EastGroup acquired the following properties: REAL ESTATE PROPERTIES ACQUIRED IN 2023 Location Size Date Acquired Cost (1) (Square feet) (In thousands) Operating properties acquired (2)(3) Craig Corporate Center Las Vegas, NV 156,000 04/18/2023 $ 34,365 Blue Diamond Business Park Las Vegas, NV 254,000 09/05/2023 52,973 McKinney Logistics Center Dallas, TX 193,000 10/02/2023 25,739 Park at Myatt Nashville, TN 171,000 11/03/2023 30,793 Pelzer Point Commerce Center 1 Greenville, SC 213,000 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) The following table summarizes the allocation of the total consideration for the acquired assets and assumed liabilities in connection with the acquisitions identified in the table above which were acquired during the year ended December 31, 2023. ACQUIRED ASSETS AND ASSUMED LIABILITIES IN 2023 Cost (In thousands) Land $ 44,676 Buildings and building improvements 111,082 Tenant and other improvements 4,346 Total real estate properties acquired 160,104 In-place lease intangibles (1) 7,242 Below market lease intangibles (2) ( 2,230 ) Total assets acquired, net of liabilities assumed $ 165,116 (1) In-place lease intangibles and above market lease intangibles are each included in Other assets on the Consolidated Balance Sheets. These costs are amortized over the remaining terms of the associated leases in place at the time of acquisition. (2) Below market lease intangibles are included in Other liabilities on the Consolidated Balance Sheets. These costs are amortized over the remaining terms of the associated leases in place at the time of acquisition. The leases in the properties acquired during the year ended December 31, 2023 had a weighted average remaining lease term at acquisition of approximately 8.0 years. Also during 2023, EastGroup purchased 328.3 acres of development land in seven markets for $ 70,664,000 . The Company periodically reviews the recoverability of goodwill (at least annually) and the recoverability of other intangibles (on a quarterly basis) for possible impairment. No impairment of goodwill or other intangibles existed during the three month periods ended March 31, 2024 and 2023. (8) REAL ESTATE SOLD AND HELD FOR SALE The Company considers a real estate property to be held for sale when it meets the criteria established under ASC 360, Property, Plant and Equipment, including when it is probable that the property will be sold within a year. Real estate properti

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