FPI - Earnings call transcript Q4 2018

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Operator

Good day, everyone and welcome to the Farmland Partners Inc. Fourth Quarter 2018 Earnings Conference Call and Webcast. [Operator Instructions] And please note that today's event is being recorded. And I would now like to turn the conference over to Mr. Paul Pittman, Chairman and Chief Executive Officer. ahead. go Please

Paul Pittman

us Good at the the to Investor quarter and William. now will webcast and Company's for welcome Farmland supplemental call. section includes to will website. turn to We I to below it Please customary Thank Investor link package, morning is for the full related the remarks. presentations morning, Relations the Luca our Financial year be fourth this is Luca Relations join time the our and you our link call that some these preliminary XXXX Partners for also calls. of presentation appreciate the refer website under this of posted you, of With taking call is me Officer. and to for farmlandpartners.com earnings Chief information webcast. Fabbri, directly XXXX The section portion conference QX over

Luca Fabbri

who live Thank listening fourth you, Paul are was announcing full recorded. press quarter webcast or distributed this and our The year to the release and A evening. numbers thank earnings replay be this The call you XXXX. after to access yesterday all shortly conclusion to the earnings in press of call release. March are XX, available provided of the through replay the will phone either

and remarks For call. been those not earnings the as we herein made who this XX, have that are to listening you are XXXX, to today, the presentation, rebroadcast of updated remind this initial of subsequent March

potential our dispositions and well financing dispositions, impact and comments statements, markets. as our During identified of related broader agricultural portfolio, to rents and this statements as outlook the the including and performance forward-looking acquisitions, our activities, and the for call, such will future business, our of also make we acquisitions

uncertainties, financial announcing an measures included release the Definitions that as fourth company's are like Factors predict certain our non-GAAP the is comparable many risks quarter expectations, difficult to Listeners of in dated after net measures, These are available furnished GAAP result differ release we I would in can Paul? website market FFO, to now generally these the our materially which report CEO, and as call and to discussed adjusted from back on EBITDAre those Form our Paul exhibit discuss income, XXXX. beyond earnings filed to SEC. including and cause X-K our which press uncertainties and control. is are cautioned of most well to subject XX, reconciliations press on documents listeners adjusted are will statements in also and the to EBITDAre. operating furnished Pittman. FFO, we have www.farmlandpartners.com or and and to certain Risk closed and non-GAAP current measures, We turn review to as our advise yesterday risks the with actual March Chairman

Paul Pittman

Thank you, Luca.

that trend was stable asset So news and a slightly we despite to to year, good the The continue. the growing in many expect challenges. with those challenges, to summarize that values year this is remain value, clearly

$XXX,XXX a of farms [ph] on company group to first our in Michael combination loss a led The we a challenges Hurricane particular corn wars income. as faced of events. trade weather crop was and that approximately share of of

the related We crop events, southeastern to States. excessive share income also experienced loss a in rain United of particularly

in was lost even particularly to share the which the around also almonds. and wheat, related impact trade probably million on to events, and income crop of up the directly than ended a effect walnuts with conference in general to Beyond rate, some income related the for or received $X those problem Obviously, we just lower supply events. for little war call. the to for neighborhood weather whether always crop excess a had on had It's and war war incomes, the some our third certain this any to had trade hard degree but crop soybeans, of also it's the trade we we actually corn, in year we a weather of share quarter potential to degree negative expected. possibly, But flagged a as disaggregate issue This commodities. prices

lining; who deep company into and farmland Rota payments and eventually and Long-term corn, surrounding a discount a the if a of such for over company, will price. That this negative the and the certainly supply company, on and value obviously of the all that Rota hurt a and The retention It to has position, wars continue at the a stopped growth and on article. the very export demand own us returning is The positive believe our assets of particularly our for agricultural positive buy today. article, understand shareholders incur high-quality not tight caused There trade had employee Fortunae agriculture. press, moral stock gains to the picture for it that, for RF, opportunity to personally, is up it we and fees deep, those other due shareholders we and investments. beans ended We and you be situation. underlying end, will taken factor misleading potential price employees, low the of to pool see the article. of and me deep for us many have Fortunae returns caused to a of created also very is excess is news business been shares to general this losing manipulative in stock wars the a to the line. will that legal the that. our a company's is U.S. investors silver good for current of essentially, assets Beyond impacts trading weather talk loss But negative advantage stock's effect trade in and G&A there deeply for false tenants. the impacts, the negative excess shareholders the

cash as of values. a us as many understand, Asset on to not farmland all impact remain we values near-term flows direct stable slightly do -- have upward

year. put to leased place. of farms past not rent point we we in issues the we've of on believe we be operational terms the planting, approximately the our this and increases average, one before have have leased for are leases saw lease-up of On farms the one portfolio. approximately had in XX% vacancy those not our a At on do of time, this we expect X% in the new Turning farms XXXX some of in of we crop rest year, will

a of of ago, of acquired tree all years as farms many X.X in [ph] know, Valley of that a series to we you Central about referred As transaction, OLM series we farms is the nut California. that the

be the now that the line During unscrupulous had payment appreciation of in price. the fully overpaid been manipulators participation another it XXXX anonymously rent was, price and not a payment fourth we've can the true, but of in made we proof quarter first by quarter, is repeated falsity promoted their for rent in just systematically over purchase XX% as we expected, assets This the the our approximately of sales our seen gain OLM that narrative that farm. paid. has assets share false at our have was had farm never crop expectations sale of with [ph] We that for over stock that on material of

G&A legal Our hurt rates and financial debt, bad were I the and litigation. modest interest higher as revenue, results, earlier, a crop share said RF to costs higher lost by of amount related

look it. stock Turning to net at asset we of value as the

I we As look at always ways. this in three say, different

If a you of $XX.XX. to cap do would price approximately analysis, a rate-based traditional come you stock

that today is conference not overshoots and in call, fact we As the that in NAV methodology I believe said prior $XX.XX. our

the methodology, reflection should data If them and stock look reflected, take we our at through based of come farms We is appreciate you on state-by-state price accurate $XX. up valuation portfolio be the believe the approximately of underlying that time the reflected the with in of on you stock USDA the price. purchase most a a where of USDA price basis, and

In share. would $X.XX analysis terms of if value value, to it book you per do book just simple a you lead

importantly, approximately point worth and believe this is back So the the higher. more X.X% the least of July gradual that deep asset management We continued appreciation creeping X.X million because repurchase bought think time. that the continues at discount company Since that appreciation, that's $XX, this at valuation of that shares. is in and we is have stock of of a shares, of stock to XXXX, will continue

financial Using $XX that continue the such that will shareholder our We do until of future buybacks value value. are benefits a from the point approximately buyback those a reflects of share of stock into net price, the for sort time price created view of $XX more accurately to shareholders. million remaining asset

Rota and playing in to Fortunae related hide turning of an the federal Now by lastly, litigation; still this are to court. financial crime shenanigans effort making the perpetrators

and However, it was paid that Rota clear fraud there that that co-conspirators were write in becoming article. Fortunae is to that

to part scheme manipulation stock was this and scheme, continue believe that We a vigorously. we of pursue will

of hurt. recover The is to by that are who is lawyers fundamentally on were same fees. shareholders is those to We Fortunae case contingency the the based an were on but not on made exactly with driven lawyers pursuing that class desire for by money based action unscrupulous Rota are and effort claims based facts collect that

Our strategy XXXX for is simple. very really

to continue those and collect good rent will We rents. to tenants farms

selectively shares, Fortunae I'll point shareholders. and recovery our it Rota we Luca. get costs, a overhead financial our will We major they control for we and to you. their buyback co-conspirators that, over preferred, and both With Thank to farms to common will the pursue turn continue that and sell will

Luca Fabbri

Thank you, Paul.

a increase I'll operating XX% quarter the the through about were up. and $XX.X of million, year-on-year approximately usual, Revenues for income the for XXXX. run As $XX.X financial fourth XX% full fourth million, in highlights quarter some with

that -- quarter the common Adjusted the increase $X.XX clearly $X.XX, $XX time. a little regarding as quarter in the year, to specific negative XX% were of those the performance $XX.X on almost been which Basic place for over XX% regarding were $XX.X issue similar outlining impact for per is with any the ahead about share One income almost XX%. extreme some XX% quarter, is on year. some in $XX.X of the $X.XX note quarter operating of items the of usual note revenues million, cops due of was had crop the take year, of for of the we up. per an clearly focuses XXXX fourth forward material revenues to AFFO $X.XX that financial million, fourth of year, a it lion's million, beginning this going explained up just almost really fourth since year-over-year the lot the share for of have revenue the remarks, the knocked-off was was the share weather million, and For other stockholders value income revenues share as receipts up not pulse net for impact full with was Couple very of have that year-over-year on and to full and EBITDAre the effectively like income important, stuff that. seasonality trees of and we item events of did events, was assets

million at to more it; $X.XX. kind X.X broad little the a bit in painted discuss activity stock the Finally, like of we common I price of in shares of repurchase fourth average [ph] Already repurchased an quarter strokes of detail. would

an $XX.XX. We price shares also XX,XXX at Series average approximately B of repurchased of

session. year-end, full count this average current X.XX in an This shares of XX,XXX would year interest The Partners. additional average share an shares remarks $X.XX, million the common XX,XXX,XXX morning price $X.XX, of to performance X.X price shares. the of XXXX. shares $XX.XX. begin price We in concludes purchased your Thank my of fourth and for shares operating diluted is Series an After at we quarter your of and on an B of of at bought common B $XX.XX. and like and XX,XXX about year, For question-and-answer our for Series time full at average Farmland the we million you fully common

Operator

with Stevenson Instructions] first from And [Operator question today Rob the of will be Janney.

Robert Stevenson

is the hit on weather there that insurance the earnings? you any in of about events the Paul, to terms talked

Paul Pittman

have generally of level insurance them. assets underlying the on So some

but entirely pivots on a For was insurance most we by that those didn't had pivots. Florida we covered Panhandle fully example, because it, of we had replace hurricanes, wiped almost the one it those the covered farm to mention was all out -- in don't the which but it was I by by I of one -- remember a own insurance

have it's insurance So good. we've harm, perfect don't got underlying it's coverage, generally, the pretty never but on we any assets

itself, protect and downside, the and that did it bonus recovery farm all se us and full have on on the meaning rent we you not the of are the is generally return those farm, your should that cover per the area, lost -- won't farms Insurance year, farmer but basically it bulk base therefore from crop would coverage give happened. particular, for rents our additional all the will been terms what pricing upside of these crop in on have what for enough the In that covered really to get that's and bonus that we insurance not row we on rest. What a will the things lost rents. in due to the

Robert Stevenson

really sitting own And stock you're sense then, point this could where make acquisitions buy your as back? at any given you do today here

Paul Pittman

to continue either property, will add at really from time, on example, a own. that do good for already foddering property acquisitions to a be we is can specific We very acquired time [ph] a value of or that

largely, the a discount. out we in because already time So business buyback an this in know the to repurchase devote farms but our of deep of our interest capital ownership at will acquisitions stock essentially and already such we we're not own completely can well owned at the we point

the of And but so not primary the capital focus that's spend. entire our focus

Robert Stevenson

or have at for under marketing anything contract sale Are you point? guys this sale for anything

Paul Pittman

don't we have we contract. what -- We're under about talk not

those We will use to I to sales have stock. make continue, occasional and as funds said, repurchase asset

see stay each So them will quarter. report you tuned, just we as

Robert Stevenson

in really Luca, to the sell without you pay I rules, having REIT year mean much under could how special dividend? a a assets

Luca Fabbri

The of rules, of of We transactions. issue on dividend the lot is it and more also still have kind still side. with the a to more tax on sell assets than a comply depends number ability the special

flexibility. have a we lot So of

Paul Pittman

we a limit we assets issues meaningful ability our those to sell intend Yes, will on [ph]. pace not at the be to

Luca Fabbri

question, really extent your we the it's -- course, of dividend to not address the an on not really radar to theoretically about the of that assets truly it's are Specifically the but is very related screen, issue considering. much relevant sales

Robert Stevenson

talk And providing brought a unless then, missed are bit guidance I about what it Can you little decision? guys -- that earnings somewhere 'XX? for you

Paul Pittman

portfolio the particular, analyst you Today, with asset if in the the year's But We did not now what need we at it future. not we for very, did supplemental, revenue right guidance guidance in when put aggressive last in revenues, can earnings it you, at in guidance of lost growth and may put mode the cost provide tell the this was from to last least help was you sales. structure; can you community out for look was following reason; very year's the important. we numbers

in the And we've done guidance so just really additive going particularly past to what we projecting be found to not forward.

not to guidance. put out we're point this at a So going

Robert Stevenson

as basis, and a likely yourselves the shorts, guys to against these going look in guys you mean as RF lawsuits; significant variable legal a to any when the legal fees to number the at action are against fees well that's forward On XXXX? of the are how class anticipating you be defend thing guys on that related may I lawsuit pursuing year-over-year one be you

Paul Pittman

here. just -- one give me it you give Yes, I'll second, I'll answer please. right

a fees. lower. use those I they're know RF, to cost desire, for somewhere going they've a we up don't at when. coverage of which But will, company and $X.XX on And to it. pay number not full will year impact see a much you that I would want some we too to get if if from things. to might get committed back those be of -- we're we'll recovery legal just and shareholders. They -- $X.XX which we'll So to the we're that the our obviously, because on would crime know from be that Then harm and going be conservative, that It give but insurance next you $X.XX $X.XX between it estimate did

Operator

And our Dave will today next Baird. Rodgers with questioner be

David Rodgers

Paul, What year-over-year over to of you'd the kind in the on what that of leases can first the And of expect in component portfolio? the that rent about kind is quarter? revenues roll the you talk in the of you're roll? change here percentage going be to repricing that

Paul Pittman

Yes.

materially be. it speaking than a you needs it more involved when confusing, gets on lining straight So cash to basis frankly, because get

So the one-third I as XX% look can back of we'd of in up leased quarter third transcript you at think company that leases conference for had a said At of third of already them, call, renewal. the quarter we the the time. the about we roughly

X% open To something sort about expectation average, them over in we'll of, weeks. a X% about rents. we're next that context seen The Now an leased a the bump though, annum of right? And that's what not of few be per rest result the of we proud leases, here we've XX% rent like have done and have a particularly X% on to would in long-term bump. a put is

So to old. lease that's doing giving XX% that when X mean years would you're you're X% at

rental So over historical in sort process would we're number but underwrite of you to rent increases a they're squeeze small roll not the the able out long-term. to

going and lower balance prices gradually good pretty having in faces So in going operator are so capital the farm recover. going a where and there seeing. until declines rents show fertilizer in that's cases; down, tractor really isn't their what to kind aren't his price we're down, it's profitability neither of going price most are of down, seed operators out during farmer for really down, by this we're isn't up our sheets not the goes These you his have seeing but property working any taxes row right? that And income challenging up, expected or farming crop high -- as pressure meaning you're everything But of farmers, -- substantially disaster environment budget means would that's as but not profitability rules. phase see about we feel His in going relatively it's farmer a wanted. it's we're we are rent operating

David Rodgers

of it excluding color, squeeze appreciate and on that costs. G&A I plus of Is or or that ability Maybe is on legal professional minus… helpful. to any there X side the out the that's any kind of more

Paul Pittman

bit a cash Again, because squeeze We'll because basis it. money. GAAP easier a talking kinds not some little a as costs about. been, of example, the to think acquisitive; and not just we of for not on out both, all as not that legal as company, we're of basis much and and nearly pace aren't traveling accounting it's a raising -- us saves We're the saves travel capital us we at had like. We're that so G&A

the or in company keep for but So yes, we'll continue that. margin this time, on opportunity employees personnel XX is this is I costs. and XX down G&A we our pretty an we've at with material a to not shift costs realistically, reductions pull point will run -- there forget, tight in a And doing

David Rodgers

to resets on then Luca wanted to for I interest the And XXXX. rate add maybe

remember terms impact 'XX to I of think that in if $X.XX be you reset? I'm 'XX me I wrong, if previously; would do what you and the estimates have on maybe for the -- from updated another correct said right,

Luca Fabbri

outlook last mean has that. on interest I rates the than course, the changed in months. Probably of a a bit, few quite little less

giving precise I less feel So be little than a number. a it comfortable that. should you don't

Operator

Raymond [ph] And today from will our be Paul next questioner with James.

Unidentified Analyst

a of is you. traveling [ph] Colin couple questions for we've got but

that trying roll you and million talked trade? $X weather could guess about, we're 'XX. forward maybe that is the you into between break to that On what do of out I revenue

So your on that comments would be helpful?

Paul Pittman

other general I'll We back $X.X $X excess think it share stepping -- about and in and might all because is crop an the wars. Today the excess trade that to trade an disaggregate soybean challenges looking supply million that related and think of war. feel degree kind exacerbated so example. big a we operating why calendar excess some United supply to words picture, we supply explain of events world, soybeans -- we've trade last that the us of of modified true issues; with the you when think; lost And around income weather an at weather soybeans, corn -- on as occurred have excess of related there the to to the before So year. supply weren't that during was that's like $XXX,XXX year, the and or of just directly the it's use specific was very like specific course, the Paul let's farm perfectly, in war hard was there given and is that by States; of million

And where [ph] and line So giving but it. you had you challenges is no opinion, absolute the pricing behind no of an it's the draw we're specific you there then kind between anyway so opinion certitude war? -- do there trade honest is our

talk of weather kind let's easier events, measure. weather to the the is and bigger about them. So The

have -- zero we pre-corn the farm the share our nuts by to I knocked because were essentially the hurricane. said, where potential trees as off literally So crop [ph] taken was the

seaboard, where reason at received we that didn't year. all inches the bonus get had huge you farms than have look rainfall. XX particular, rents And North eastern have is that in much you're amounts; as on but the the in this normal, at we as bonus so a Carolina, rents more for We historically rainfall have XX go or to chart double I'd sometimes fantastically any talking

farms average crop are just look trade excess We have take loss weighted and those crop rate-related, there shares. not of Western being issues of we also of States, hurricane-based United normally just terms -- the wheat, supply-related. Colorado, Western that Eastern of not the then and and some some And And in too corn the was it Delta some generally had that Kansas; the crop wet. general at part soy. shares, We in in our more was those probably

year. of will correct of and happen crop we Farmland in themselves. We the those believing that our of I'm for get update going assume come as year calls and surprised and through to the we'll rents now and But I this portion my also of start but all XX is land revenue time get negative and frankly see; going relatively that a would ownership positive year. rents helpful. that million this new was time in share of -- that portfolio been run won't [indiscernible] year start from these because this year, approaching you're hope fixed to and to is this on a and assuming don't you're or modest productivity surprises, to year. to issues a go life, We'll years has a $X.X the mean, farming you year. sense surprises I've a not we why that I in negative we'll have next very this happens will it bad surprise every broad have really just So perspective wait try is

Unidentified Analyst

Yes, it helps.

Let me anticipating any in year? development your what costs trying you of just you just On go to talk the can We're have CapEx, spending development for you're this left to on about farms. remember another topic.

Paul Pittman

the find farms let think, several data the got have -- that, me it's still page in we we've the… in supplemental, it in it, hold development Yes, some I on

Luca Fabbri

XX, Page maybe.

Paul Pittman

will -- things for not farms in will Today up making Those get gradually a us return Page revenue get those $XX.X on page come blended properties. about average crop if of there, things in ongoing and combination of rates occasionally yet, still well development of million. a tend are construction into most certainly where And the we're But us portfolio, they of got will that specialty we full cap are properties properties Yes, average. got portfolio anybody's we've is and as a in rented some end give row XX X% worth irrigation that above lot either they those contributors, overtime not the then because big progress [ph] supplemental or productivity certainly crop -- of this crop of something million; where higher sort. we've approximately specialty grain as than producing looking. to storage improvements on or that's development is that $XX.X a the

Unidentified Analyst

spending for this And the year?

Paul Pittman

be this CapEx reasonably million I Spending of a that's the will for CapEx year $X spend a -- low, range. we're year in at think total spend looking about

Unidentified Analyst

that then the buyback going we the sheet, sell assume And side farm you stock balance to preferred? of a the think do debt when should on of sheet? in How you're that balance you

Paul Pittman

range; most debt. that. conservatively see selling continue are about sales XX% of at So should straight will properties this to speaking, you an -- we it, above, generally whatever average If about is a sell when farm we think think how we of lower debt, XX% our price about the slightly repay when probably XX% than go repay levered it's so of you'll to XX% though will go

The preferred. other or repurchasing go of will repurchasing a combination for stock in XX% on

Unidentified Analyst

the think the step as And sort as rates And we just then is about how far you could of about? to process? really sale the market talk you cap want should up if selling farms, active

Paul Pittman

now I are -- at when material paid. down a X in a the we're X very looked particularly for now very higher the sold keep capital. since country probably and region don't -- to we a rate good asset like; at to pace selective of the here, of sell we we'll the go supplemental; properties, sales sell number the next have out much not somebody or the don't numbers backwards, round farm of We'll Rota positively lot not we changing either what we offers at management X if redeploying chance whatever we are But in that a X or that just negatively; cap to million trying turned premiums have costs months. it's so in business of sale the process. a find of the selective $XX reason, we mean, have months, in to been price kind in and sell away could We that we've we're plugging it's -- making or almost reasonably sold here that's you in the a Fortunae, farm but this, We're we've to that

likely cap blended close. would In X% rates of pruning would of to the sell average but what we the sell; terms although, if on to rate you'll use scale. likely highest We're if cap really returning we rate end not the somebody to be more average lower sales, of be I an cap think rate you farms, overpaid our of we're asset cap our around --

Operator

next questioner will [ph], today And private Watson be investor. a our Ryan

Unidentified Analyst

that the in acquisitions? is passed, farm any the Now Farm new have guys you would Bill hemp-related interest

Paul Pittman

We probably but yes, -- acquisition. interested going in hemp not aren't probably a farm to we're

can fall or and go of changes, Our to X crops non-GMO; because those the view return land change not the value it's farms to just it's for from you them. after that much X back the hemp, could hemp, ground, organic, on value row really overpaying but the not doesn't they very acres -- on is years a crop want rent you farms traditional those you per it's don't growing get many higher it's trick -- for it's on the

it's limit we paying grown so market are particular, So of -- incredibly to seeing is cost stay is crop; to growing hemp those the there lot and is an also bit and a yes, of we or many a rapidly we of farms a we believe tenants are we had how much of hemp, -- other are certainly may, to. while of interest attention in in have of in high that a input any something hemp, about future changing. and learning But here I cannabis our is a not have as today products, quite -- lot on our

how or So want this risk much to limit at there tenants given hemp, in to in particular. is any a would on crop, we either take our time point

Operator

our today with Kucera questioner be FBR. next Craig And will B.Riley

Craig Kucera

quarter early of shift think occur? Did the see that in 'XX that I on pricing. mentioned you the any might some you in maybe of a expectation participation income the fourth better

Paul Pittman

of record it But number but I couldn't going number. of that that that was it when have I sales think would have unpriced to to would did there it significant in some dial mean, the in modest it the that's those specifically occur. a is some revenue that up a revenue means in year some something don't which specifically. way going XXXX huge be -- corn, if out we wouldn't catch shows be move as for Yes, up you of of drawn example, out 'XX we'd called we have we occur will or inventories really a We,

Craig Kucera

to way any went with events lingering damage? sort at weather or point all assess you the any there the is anticipate And do damage any that this lingering of portfolio through,

Paul Pittman

we you of We prepared down the damage really pretty don't many was you comments, torn insurance. got so If loss tree the we board, that didn't on have Generally talk same lose them by what second. up a nuts anticipate not any in of Meaning, in -- had thing the -- side. loss speaking, I'll had asset. crop off the about real the row replaced trees you one down, not a and saw with didn't but the which crop did lost tree across said we exception, consistent lingering important knocked itself; that's Luca pivot we underlying knocked of this very

exception; -- asset end improvement have quantify incredibly drainage will got place in means. that that have to be row feel it really the or values impact causing you structure major event. you've one show a XXXX this the there risk California avocados, will weather did hard what XXXX in forward. with it properties destroyed. any a but would and structure in XXXX, crop event because negative we like -- that fruit side, occurred it of Then hurt that we impact impact in heat on going On by a is have up the But your a don't not that particular, or think the impairments was to our time that got negative the could up effected any XXXX amount to in we one event we of is did a turning exact point at a When drainage set is

Craig Kucera

asset that value is at mean And point in asset there we the impairment, believe don't even still… an I case is this that

Paul Pittman

it No, doesn't…

Craig Kucera

No material crop issue. it's just change, a

Paul Pittman

out year. end of next top the take to the going crop certainly We're avocado

Craig Kucera

your was the for And last was that one looking operating was give guidance that year-end and mid-November; weather us for time? bit your what at on me, point in color you could expense up and than just looking guys that why related higher to for some or a were little you

Paul Pittman

direction largely with guidance additional we it we mid-year, think driven but had Fortunae we and higher We of -- of on costs had rate driver as they expected it's that related Yes, truly, visibility we about that cost ended the big interest of favorable you expenses. we coming set what under-estimation put And higher property our back expense that if we forth. the additional is good million but prediction, tax than they do. operating $X most you the and But G&A Luca accounting, legal is surrounds big up other now was of probably as $XXX,XXX so in I is of driver have largely were of so some And in alluded, on all property types, Rota that had that back of than guidance. frankly and increases look to is. changes, out around by that's the at somewhat are experienced, us when

Operator

next investor. questioner from be [ph], today private Mike And our a will

Unidentified Analyst

you know the my previous Paul for in taking on this I Thank Mike. and Dr. we past. is spoke Luca, calls call,

kind a may concerned trading look truthfully either more a feel be are smart only that psychological is plans, and market, company said not but sounds themselves not But right. involved can two another buy more, a of investor, if you great it Because too and can want looking as and know then kind to you, of organic I possibilities and but and have great kind company like two mechanisms know down blind of we to happened with what investor, are "Hey, phenomenon is you goes there some before, going to you're here? mean? that have and stock. the for them wonderful I I good get shareholder what's available we're because there how we that. share, of all I predicting at do like We the know and I'll to as how think here speak a I'm know a a question is point to cannot more is, this but sexy I I work stuff, if on you're $XX you about the we you we're was My am really to selling it while if are sense looks there investment. from say, in this the is, question I look right, there. say not off, like and you it what at new and this You really of pure-play I the you new guidance farm spots" cannot pulling Things So that's the to out execution, you I'm some that's to selling for my what into and farming? the the the things get analyst calls more your a

Paul Pittman

Yes.

the to of with this our into ago So that I point valuation minutes opinion, are the $XX view of you activity. even when share are investors repurchase I time in always these number which now I time, of new expressed a we points given the make our stock and investors, from all higher or bringing new make; few to a speak X

those As value as $X, than you we're think worth stock gaining long our was on all of repurchases. more

to of purchase and number. so share USDA price, forth; roadmap by the the long-term a kind data, so we $XX draw try the So trends, discussing on to that

I'm by management, ownership the wrong. we Then book thing high trading really price. chance company per should don't just share, just simple, look given Look, so that values thing me you we we continued pocket-book of $X us be I in is the number it's our second securities. the the of $X me even about because below at is believe far we we in level of we levels. and we're are are, not, have just certainly stock and is there book at particular, and with $X.XX share in $X.XX stock the seen declines other the the kind value that that a believe to don't haven't are we're emphasize at value own the and would about we that $XX, asset now, buying certainly the and my emphasize betting that be you The very think buying seen per so have

the got by of repurchasing the company so dollars own vote and management. repetitively our in by a stock, members And you've confidence both with of

messages at that press And look the are the headlines you've give. and the that those to real got today the So I headwinds I also the agriculture. to look think popular facts. in relatively through you got see about you've negative

bankruptcy." major it food the Well, this one I an true a let's that like use mean article low. lot it the but of numbers saw is percentage incredibly went incredibly call go bankruptcies in I of [ph] every omission phone it's a XX% that like the change But in to the industry, few "Increases incredibly big or stable. us on is about sort they that. Yes, XX% XX,XXX, negative I you're reason the but this also one and incredibly There And like is you the absolute going weeks. an misleading it's that article sounds makes. are of is loaded industry, the business some low talking farmer just margin last stable if long, eat different article by XX,XXX industry So article said, level that's to bankruptcy number already is that's assets is they production increase have why approximately today some sounds It to in for told X.X in a a force from stable, business to we're probably right? very X.X or posture ate why -- world's system and not are tomorrow; going again these at

are of stock value move drive and that the company, the day deep things really our given that and of the on generally not that So the we to a try stable, we'll the and underlying positive on stock but a to speaking price convinced there value get the discount continue is way. assets people the

years, calls think I for focused so talk phone now important I keeping multiple food the this on listened to is and do it thing. many demand If calls you've most these again, about I'll

when and also going that is change. a big change domestic stuffs fundamentally of -- States lose we you're going to If huge supports I well. values of a over theory we're to kind on are stuffs foods with types. stuffs. is data primary a I changed, underlying If U.S. going it only somehow secular for food night, sleep happening asset don't and domestic United the long-term of there would decline the the not medium demand worldwide we exporter producer and That as market food that something have that's exporter think not that so for and the go market is any is to U.S. there make that long-term, in primary at the all change,

own continue the bet buying reason for my money stock. that I to So just

should be certainly -- hope up times We new great give stocks Mike? but times with of class. vision that's be which a with, much it's bad what don't should to stock year the it shareholders point our a is we not our what should anything are but more but it opinion a helpful, the that's it asset X% a should investors. actually entry want This are into who volatility trading asset down a great in like it done. assets, class -- X% trades the look, have underlying I be kind of that's stock So and want year, understand the we are the the isn't the message that's close it's that -- long-term

Operator

with DWS. And our Michael will next questioner today be [ph]

Unidentified Analyst

out selling need it that a perspective negative short the to of sort allows came much below machine repurchasing respect to and a sell from summer company value. above seems near-term; crank of it last report shareholders, more positive assets of don't that the than with and So the like you this stock it's value book to money of long-term the in book

more we these a I positive and So and guess, all value? not take book costs see on employee I that a some retention buying just of focus legal And specifically, question my a don't at stock the devoting to to it such your money is, guess why as why deep resources just negative? you're -- then discount

Paul Pittman

not our we're we're that money keep market good we the funny it of I for it's these that -- you seldom sitting things chair say to make of same the for if why money us. it to amount this. pursuit accused this buy that shareholders and we distribute that's this to was in or took new fraudster sit a whatever. mean, is we lawyers it that or somehow point the back in this the I to the going this people in, The assure Yes, anonymous can of to tried stock I be get feels substantial company of you good accused possibly are were stop the going and and have of assets But out had confident legal will falsely. to claim,

We the it -- was fall think we have front-running action you're are stocks on value impact because that anonymous will I underlying to I year's they if there valuing be mean, recovery, I as to our as trading an mean -- causes that at the news. not that chance pursuit and XX% And also to be of own don't lawsuits of hard is We our And stock that AFFO, the matter purely are assets because it are a hard -- pursuing of have we an that believe away that and recover farms; assets, near-term valued, company, as money-good way unfortunately, and because is fight based if of is worth, an assets. just money of don't these I'm some should of of massive may have their we trying pursue level XX% the this class pouring is air at his it false underlying they're to significant that a amount multiple looking guy believe stock also somebody think what sort stability clear our reputationally continue financially. matter, with the based which us of not to this to impact of be least scale earnings look much have as it's [ph] truly should financial this. just should is at the to on -- in certainly earnings for the that look, our the it recover but a It they and not saying try stock next pursue on cost. but to is you it, assets are

that's we disagree -- may why have. that's you but logic the So

Unidentified Analyst

machine? And follow-up because -- of repurchase like above those using it what does proceeds average certain would seem you're the the is towards is stock? one then bottleneck, guess what allowed be; our bottleneck just that volume daily like such to I to go sales and free not a percentage money asset there to a Is

Paul Pittman

own Yes, speaking where has mean you've of of security, I back laws what -- within cap it's a it largely the regulations is the bounds to basically, when and it do set it… company -- buys got

Luca Fabbri

XX%.

Paul Pittman

artificially the we through repurchases. up we obviously, of calculation force to XX% look, volume -- don't complicated approximate stock daily want price result. that's average and but the a it's And

only, In program tick I buy fact, the a way our repurchases on or can we repurchase think, work down flat. in

and it the keep million based we there rules on made, you're and moving. stock relatively buy minute going the back assets to that I hold of we've are opinion probably assets -- But that in the repurchases to dealt I'm want down up going I away from some trying pretty fall the we're that's to -- buy $XX artificially hand smart see we're gradually see ourselves. machine us up the market, going. shoot our you're against just have to stock, some trying drive market price some and in sell high to and volume but why more we'll hand money the then I if so just temporarily $XX got go stock, the follow, proud probably and our we sell sudden with is we buy stock were a backed as million we've of be low our out-of-play to stock, we've value and so stock to as And we created -- could our in we judicious gradually a that and keep can, don't

Unidentified Analyst

long-term I shareholder, shares for so of of Well, you think job share great keep guys have a done the and great up so far outstanding the work. lowering rest retiring count the the

Paul Pittman

you appreciate I very Thank that. much,

Operator

questioner will be Gimble Tom [ph], investor. from our a private And today next

Unidentified Analyst

a stock My cash, since spent article, million as held the significantly dividend share investors dividend -- either a common to year approximately of think August, on more $X.X question spent the than stock Fortunae buying cut share by and income there buybacks, million or use on last How XX%. to REIT do $XX of and And million was alternative buybacks part portion in back by dividends last Rota of dividends. goes the or $X paying shares? result was about the are you

Paul Pittman

all I this that's Obviously, a obviously, for certainly a a money not have intend stay using is means too. so I example, and any board want to or get buyback shareholders; is, and The We dividend Yes, very that mine; solely that using again. better stock the again, asking but don't to -- do zero painful dividend gradually this shareholders, will judgment all we what not always a through the it caveat all stock and dividend for money, back taking cut our dividend is I where to raise lived mean, company we've by is. it's think buying alternatively decision, you're that now to that. cut really seizing return of to dividend,

For camps. bunch that have, who get have poured think we is. we as and are, do shareholders stream in we when a stock both. as is, they've times we per And phone now, cut, from I would into of of it of also and possible to point but reason and of stay it XX% in thinking tried get both pay of $X.XX dividend we'll many the and and our people bought the bought a calls repurchases, where the all -- at frankly have understand to dividend who dividend, prefer quarter, want little we'll that phone the we dividends where view no we've pay we calls came were money annum of they to I I $X.XX some more people it that now us recent for leave from a

So stable. will our that be through would don't fundamentally but year it's view the I call of not nice with obviously kind intention is and mine, balancing. our a that be clean and caveat that's -- a Tom, question. calendar that good Certainly, so have this the the that's answer, board's

think our -- You to shareholders of bit right to and I feeling now. medium close surveying the happy we're a try little gut just find it got based sort right on pretty

Operator

[ph], questioner Joseph investor. next will a be today our Kyle private And

Unidentified Analyst

the considered worth sometimes in a -- over external to the idea you -- something [indiscernible] quarterly, portfolio. in external company saying and guess, appraisals $X your because upto that of order appraisal Have comparable of of they shareholders are their better I other assets share overpaid is for assets in are performing you some inflated? public value book only is The of give people an what it's like market annual Gladstone; XXX% if do -- or

Paul Pittman

a they that nothing I particular, but intend on considered of We If what in never think have not every us it's do top would that long our know have buying is a do And over spent we worth, farm this reasons, time on one done it's as of an achieve. based an dollar they that it. can important release the we collectively, need long, decades. past quarter. management don't me -- our lender farms of believe few to a shareholders; I've and behalf an should and that. from on investors money that team, lot quite We a We own if -- do we as tell asset And be assets I just we going and wanted it's think internally don't you to tell it that lot us single publicly. selling expensive all certainly a serve various of go us buy, money time a what the -- believe as appraiser waste information actually -- portfolio are in to -- appraise an should money point every to will like appraisal want to I and us, just would incredibly portfolio appraise And make they I -- requirements reasons of I like of sometimes sell. I to the We would Yes, in asset. I that frankly it's I the think it we appraisal appraisals what us we appraise the if is, every for anchor have when not to done our proposition. a and sell time. worth, final most things

So to of kind values for -- the count believes view, we're truth. you going watching quarter. $X, we're at everybody the not our every point $XX winner it on our telling an to meant company, to we stick worth we're to tell for as it's of at we're that's that, and if who is of And express going do and absolute view for me and trading buy back, least

as long can. keep need as we doing as we'll long that and so And we as to,

Operator

any back conclude for like turn over to Pittman this our Paul to closing conference session. And I the would remarks. will question-and-answer

Paul Pittman

Great.

e-mails supportive of thanks as a sincere in to many shareholders through difficult conclusion and the I say to a for many get is many, what We what's shareholders. team company, have. year shareholders, wanted employees been the So so the phone for of just from calls and and you for we

do appreciate we we So appreciate company. that, of your our really support

do many, very people supportive. although and some we have continue empathize Thank know the meantime, will why been the For shareholders, feel up, We with continue encourage have high-quality there you your direct farms to caused always lost us we to we've is upset money at rents not those very calls really them. assets Rota not it, stock. calls, those too, most lost of disappointment you you, would who And have do frankly we and have negative. to co-conspirators, have who money though is are that We of the as on called you understand and sell upsetting. Fortunae own we gradually which at our repurchase us, done In people but what to collect and much. then, you

Operator

presentation. you your for today's all attending has And lines. may conference you disconnect now the Thank concluded. now And

Farmland Partners (FPI) 14 Mar 192018 Q4 Earnings call transcript