Phillips Edison & Company Reports Second Quarter 2025 Results and Increases Full Year Earnings Guidance
CINCINNATI, July 24, 2025 (GLOBE NEWSWIRE) -- Phillips Edison & Company, Inc. (NASDAQ:PECO) ("PECO" or the "Company"), one of the nation's largest owners and operators of high-quality, grocery-anchored neighborhood shopping centers, today reported financial and operating results for the period ended June 30, 2025 and increased full year 2025 earnings guidance. For the three and six months ended June 30, 2025, net income attributable to stockholders was $12.8 million, or $0.10 per diluted share, and $39.1 million, or $0.31 per diluted share, respectively.
Highlights for the Second Quarter and Subsequent
Reported Nareit FFO of $86.0 million, or $0.62 per diluted share
Reported Core FFO of $88.2 million, or $0.64 per diluted share
The midpoint of increased full year 2025 Nareit FFO guidance represents 6.3% year-over-year growth
The midpoint of increased full year 2025 Core FFO guidance represents 6.0% year-over-year growth
Increased same-center NOI year-over-year by 4.2%
The midpoint of full year 2025 same-center NOI guidance represents 3.35% year-over-year growth
Reported strong leased portfolio occupancy of 97.4% and same-center leased portfolio occupancy of 97.6%
Reported strong leased inline occupancy of 94.8% and same-center leased inline occupancy of 94.8%
Executed portfolio comparable new leases at a rent spread of 34.6% and inline comparable new leases at a rent spread of 28.1% during the quarter
Executed portfolio comparable renewal leases at a rent spread of 19.1% and inline comparable renewal leases at a rent spread of 20.7% during the quarter
Acquired six shopping centers for a total of $133.3 million at PECO's total prorated share and sold one outparcel for a total of $0.1 million at PECO's total prorated share
Subsequent to quarter end, acquired one shopping center for $7.6 million at PECO's total prorated share
As previously announced, completed a public debt offering of $350.0 million aggregate principal amount of 5.250% senior notes due 2032, and 95.0% of total debt was fixed-rate at quarter end
Full year 2025 gross acquisitions guidance reflects a range of $350 million to $450 million
Management Commentary
Jeff Edison, Chairman and Chief Executive Officer of PECO stated: "We are pleased to report another quarter of solid operating and financial results, with same-center NOI growth of 4.2% and Core FFO per share growth of 8.5%, reflecting the growth opportunity in our grocery-anchored portfolio. Retailer demand remains strong, and PECO's platform is driving meaningful earnings growth. We are also capturing a meaningful portion of the transaction market with $287 million of acquisitions completed to date at our share. Although we recognize the current macroeconomic uncertainty, PECO's strong balance sheet and highly-experienced team are well-positioned to drive continued earnings growth and market-leading operating metrics."
Financial Results
Net Income
Second quarter 2025 net income attributable to stockholders totaled $12.8 million, or $0.10 per diluted share, compared to net income of $15.3 million, or $0.12 per diluted share, during the second quarter of 2024.
For the six months ended June 30, 2025, net income attributable to stockholders totaled $39.1 million, or $0.31 per diluted share, compared to net income of $32.9 million, or $0.27 per diluted share, for the same period in 2024.
Nareit FFO
Second quarter 2025 funds from operations attributable to stockholders and operating partnership ("OP") unit holders as defined by Nareit ("Nareit FFO") increased 9.8% to $86.0 million, or $0.62 per diluted share, compared to $78.4 million, or $0.57 per diluted share, during the second quarter of 2024.
For the six months ended June 30, 2025, Nareit FFO increased 10.5% to $175.1 million, or $1.26 per diluted share, compared to $158.4 million, or $1.16 per diluted share, during the same period a year ago.
Core FFO
Second quarter 2025 core funds from operations attributable to stockholders and OP unit holders ("Core FFO") increased 10.3% to $88.2 million, or $0.64 per diluted share, compared to $80.0 million, or $0.59 per diluted share, during the second quarter of 2024.
For the six months ended June 30, 2025, Core FFO increased 10.7% to $179.0 million, or $1.29 per diluted share, compared to $161.6 million, or $1.18 per diluted share, for the same period in 2024.
Same-Center NOI
Second quarter 2025 same-center net operating income ("NOI") increased 4.2% to $114.5 million, compared to $109.8 million during the second quarter of 2024.
For the six months ended June 30, 2025, same-center NOI increased 4.1% to $229.6 million, compared to $220.6 million during the same period a year ago.
Portfolio Overview
Portfolio Statistics
As of June 30, 2025, PECO's wholly-owned portfolio consisted of 303 properties, totaling approximately 34.0 million square feet, located in 31 states. This compared to 286 properties, totaling approximately 32.6 million square feet, located in 31 states as of June 30, 2024.
Leased portfolio occupancy was 97.4% as of June 30, 2025, compared to 97.5% as of June 30, 2024. Same-center leased portfolio occupancy was 97.6% as of June 30, 2025, compared to 97.5% as of June 30, 2024.
Leased anchor occupancy was 98.9% as of June 30, 2025, compared to 98.8% as of June 30, 2024. . Same-center leased anchor occupancy was 99.1% as of June 30, 2025, compared to 98.8% as of June 30, 2024.
Leased inline occupancy was 94.8% as of June 30, 2025, compared to 95.1% as of June 30, 2024. Same-center leased inline occupancy was at 94.8% as of June 30, 2025, compared to 95.1% as of June 30, 2024.
Leasing Activity
During the second quarter of 2025, 276 leases were executed totaling approximately 1.4 million square feet. This compared to 277 leases executed totaling approximately 1.7 million square feet during the second quarter of 2024.
For the six months ended June 30, 2025, 510 leases were executed totaling approximately 2.9 million square feet. This compared to 522 leases executed totaling approximately 3.0 million square feet during the same period in 2024.
During the second quarter of 2025, comparable rent spreads, which represent the percentage increase of new or renewal leases to the expiring lease of a unit that was occupied within the past twelve months, were 34.6% for new leases, 19.1% for renewal leases and 22.8% combined.
Comparable rent spreads during the six months ended June 30, 2025 were 31.8% for new leases, 19.9% for renewal leases and 22.6% combined.
Transaction Activity - Wholly-Owned
During the second quarter of 2025, the Company acquired five shopping centers for a total of $128.0 million. The Company expects to drive value in these assets through occupancy increases and rent growth, as well as potential future development of ground-up outparcel retail spaces. The second quarter 2025 acquisitions consisted of:
Clayton Station, a 66,724 square foot shopping center anchored by Safeway located in a San Francisco, California suburb.
Oak Creek Center, a 104,124 square foot shopping center located in a Columbus, Ohio suburb.
Cross Creek Centre, a 37,192 square foot shopping center located in a Miami, Florida suburb.
Westgate Shopping Center, a 216,822 square foot shopping center anchored by Target located in a Cleveland, Ohio suburb.
Hampton Pointe, a 38,133 square foot shopping center anchored by Walmart located in a Durham, North Carolina suburb.
During the six months ended June 30, 2025, the Company acquired ten shopping centers for a total of $266.4 million. During the same period, one property was sold for a total of $24.9 million.
Transaction Activity - Joint Ventures
During the second quarter of 2025, the Company acquired New Bern Plaza, a grocery-anchored shopping center located in a Raleigh, North Carolina suburb, through Neighborhood Grocery Catalyst Fund LLC for PECO's total prorated share of $5.2 million. During the second quarter of 2025, the Company sold one outparcel, through Grocery Retail Partners I LLC, for PECO's total prorated share of $0.1 million.
During the six months ended June 30, 2025, the Company acquired two shopping centers through its joint ventures for PECO's total prorated share of $13.3 million.
Subsequent to quarter end, the Company acquired Village at Sandhill located in a Columbia, South Carolina suburb, through Neighborhood Grocery Catalyst Fund LLC for PECO's total prorated share of $7.6 million.
Balance Sheet Highlights
As of June 30, 2025, the Company had approximately $972 million of total liquidity, comprised of $9.2 million of cash, cash equivalents and restricted cash, plus $962.8 million of borrowing capacity available on its $1.0 billion revolving credit facility.
As of June 30, 2025, the Company's trailing twelve month net debt to annualized adjusted EBITDAre was 5.4x. This compared to 5.0x at December 31, 2024. As of June 30, 2025, the Company's outstanding debt had a weighted-average interest rate of 4.4% and a weighted-average maturity of 5.7 years when including all extension options, and 95.0% of the Company's total debt was fixed-rate debt.
As previously announced, in June 2025, the Company completed a public debt offering of $350 million aggregate principal amount of 5.250% senior notes due 2032. The notes were priced at 99.832% of the principal amount and will mature in August 2032.
2025 Guidance
PECO increased its 2025 earnings guidance, as summarized in the table below, which is based upon the Company's current view of existing market conditions and assumptions for the year ending December 31, 2025. The following statements are forward-looking and actual results could differ materially depending on market conditions and the factors set forth under "Forward-Looking Statements" below.
(in thousands, except per share amounts)
Q2 2025 YTD
Updated Full Year2025 Guidance
Previous Full Year2025 Guidance
Net income per share
$0.31
$0.61 - $0.64
$0.58 - $0.63
Nareit FFO per share
$1.26
$2.50 - $2.54
$2.47 - $2.54
Core FFO per share
$1.29
$2.55 - $2.60
$2.52 - $2.59
Same-Center NOI growth
4.1%
3.10% - 3.60%
3.00% - 3.50%
Portfolio Activity:
Acquisitions, gross(1)
$279,699
$350,000 - $450,000
$350,000 - $450,000
Other:
Interest expense, net
$53,391
$110,000 - $120,000
$111,000 - $121,000
G&A expense
$25,008
$46,000 - $51,000
$45,000 - $49,000
Non-cash revenue items(2)
$9,019
$19,000 - $21,000
$18,000 - $20,000
Adjustments for collectibility
$2,673
$4,500 - $7,500
$4,000 - $8,000
(1)
Includes the prorated portion owned through the Company's unconsolidated joint ventures.
(2)
Represents straight-line rental income and net amortization of above- and below-market leases.
The Company does not provide a reconciliation for same-center NOI estimates on a forward-looking basis because it is unable to provide a meaningful or reasonably accurate calculation or estimation of certain reconciling items which could be significant to the Company's results without unreasonable effort.
The following table provides a reconciliation of the range of the Company's 2025 estimated net income to estimated Nareit FFO and Core FFO:
(Unaudited)
Low End
High End
Net income per share
$
0.61
$
0.64
Depreciation and amortization of real estate assets
1.90
1.91
Gain on sale of real estate assets
(0.04
)
(0.04
)
Adjustments related to unconsolidated joint ventures
0.03
0.03
Nareit FFO per share
$
2.50
$
2.54
Depreciation and amortization of corporate assets
0.01
0.01
Transaction costs and other
0.04
0.05
Core FFO per share
$
2.55
$
2.60
Conference Call Details
PECO will host a conference call and webcast on Friday, July 25, 2025 at 12:00 p.m. Eastern Time to discuss second quarter 2025 results and provide further business updates. Chairman and Chief Executive Officer Jeff Edison, President Bob Myers and Chief Financial Officer John Caulfield will host the conference call and webcast. Dial-in and webcast information is below.
Second Quarter 2025 Earnings Conference Call Details:
Date: Friday, July 25, 2025
Time: 12:00 p.m. ET
Toll-Free Dial-In Number: (800) 715-9871
International Dial-In Number: (646) 307-1963
Conference ID: 4551083
Webcast: Second Quarter 2025 Webcast Link
Replay:
An audio replay will be available approximately one hour after the conclusion of the conference call using the webcast link above. The replay will be archived on PECO's Investor Relations website under Events & Presentations.
For more information on the Company's financial results, please refer to the Company's Form 10-Q for the quarter ended June 30, 2025.
Connect with PECO
For additional information, please visit https://www.phillipsedison.com/
Follow PECO on:
X at https://x.com/PhillipsEdison
Facebook at https://www.facebook.com/phillipsedison.co
Instagram at https://www.instagram.com/phillips.edison/; and
Find PECO on LinkedIn at https://www.linkedin.com/company/phillipsedison&company
About Phillips Edison & Company
Phillips Edison & Company, Inc. ("PECO") is one of the nation's largest owners and operators of high-quality, grocery-anchored neighborhood shopping centers. Founded in 1991, PECO has generated strong results through its vertically-integrated operating platform and national footprint of well-occupied shopping centers. PECO's centers feature a mix of national and regional retailers providing necessity-based goods and services in fundamentally strong markets throughout the United States. PECO's top grocery anchors include Kroger, Publix, Albertsons and Ahold Delhaize. As of June 30, 2025, PECO managed 327 shopping centers, including 303 wholly-owned centers comprising 34.0 million square feet across 31 states and 24 shopping centers owned in three institutional joint ventures. PECO is focused on creating great omni-channel, grocery-anchored shopping experiences and improving communities, one neighborhood shopping center at a time.
PECO uses, and intends to continue to use, its Investors website, which can be found at https://investors.phillipsedison.com, as a means of disclosing material nonpublic information and for complying with its disclosure obligations under Regulation FD.
PHILLIPS EDISON & COMPANY, INC.CONSOLIDATED BALANCE SHEETSAS OF JUNE 30, 2025 AND DECEMBER 31, 2024 (Condensed and Unaudited)(In thousands, except per share amounts)
June 30, 2025
December 31, 2024
ASSETS
Investment in real estate:
Land and improvements
$
1,947,583
$
1,867,227
Building and improvements
4,266,147
4,085,713
In-place lease assets
542,416
523,209
Above-market lease assets
77,711
76,359
Total investment in real estate assets
6,833,857
6,552,508
Accumulated depreciation and amortization
(1,873,151
)
(1,771,052
)
Net investment in real estate assets
4,960,706
4,781,456
Investment in unconsolidated joint ventures
33,744
31,724
Total investment in real estate assets, net
4,994,450
4,813,180
Cash and cash equivalents
5,591
4,881
Restricted cash
3,585
3,768
Goodwill
29,066
29,066
Other assets, net
236,756
195,328
Total assets
$
5,269,448
$
5,046,223
LIABILITIES AND EQUITY
Liabilities:
Debt obligations, net
$
2,393,114
$
2,109,543
Below-market lease liabilities, net
121,140
116,096
Accounts payable and other liabilities
136,024
163,692
Deferred income
24,948
22,907
Total liabilities
2,675,226
2,412,238
Equity:
Preferred stock, $0.01 par value per share, 10,000 shares authorized, zero shares issued and outstanding at June 30, 2025 and December 31, 2024
—
—
Common stock, $0.01 par value per share, 1,000,000 shares authorized, 125,611 and 125,120 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively
1,256
1,251
Additional paid-in capital
3,657,722
3,646,801
Accumulated other comprehensive income
1,989
4,305
Accumulated deficit
(1,370,828
)
(1,332,435
)
Total stockholders' equity
2,290,139
2,319,922
Noncontrolling interests
304,083
314,063
Total equity
2,594,222
2,633,985
Total liabilities and equity
$
5,269,448
$
5,046,223
PHILLIPS EDISON & COMPANY, INC.CONSOLIDATED STATEMENTS OF OPERATIONSFOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 (Condensed and Unaudited)(In thousands, except per share amounts)
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Revenues:
Rental income
$
173,467
$
158,286
$
347,650
$
316,354
Fees and management income
3,316
2,522
6,099
5,087
Other property income
970
707
2,315
1,376
Total revenues
177,753
161,515
356,064
322,817
Operating Expenses:
Property operating
29,322
