Farmland Partners Inc. Q2 FY2025 earnings call

• Land values in the Midwest remained strong with asset sales, and nearly all Colorado portfolio was liquidated with gains. California farms had write-downs on some due to water and crop issues. • Year-to-date, $80 million in assets sold with $25 million gains, buyers were family offices. Proceeds used for stock repurchases, buying back ~2.3 million shares (~5% of diluted shares) at avg $11.24, totaling ~$26 million. • Took $16.8 million impairments on 4 California farms: one pistachio due to regulatory water access challenges, one walnut due to crop market dynamics. • Coca-Cola's potential shift in sweeteners reaffirms farmland's value as an asset class.

The company's revenue includes multiple categories. Year-to-date, they sold approximately $80 million in assets with gains of around $25 million. Fixed farm rent decreased due to asset dispositions. Solar, wind, and recreation revenue was affected by proceeds from a solar revenue sharing arrangement and dispositions. Management fees and interest income increased due to activity on the FPI Loan Program. For the three months ended June 30, 2025, net income was $7.8 million or $0.15 per share, and for the six months, it was $9.9 million or $0.18 per share. AFFO for three months was $1.3 million or $0.03 per share, and for six months, it was $3.6 million or $0.08 per share.

The forecasted range of AFFO is $12.8 million to $15.5 million or $0.28 to $0.34 per share. Changes from prior guidance include fixed farm rent and solar/wind/recreation rent decrease from dispositions, management fees and interest income increase from FPI Loan Program activity, impairment increase for West Coast properties, gain/loss on dispositions increase from 32 property dispositions in Q2, interest expense decrease from lower debt balance, and weighted average shares decrease from share repurchases.

• Regulatory water issues in California affecting certain farms, with potential impacts on other farms. • Consumer preference shifts in agricultural products could impact farm values. • Uncertainties in loan portfolio growth and its impact on the overall portfolio composition.

Q: How much more can you guys sell in 2025 given the multiyear disposition program?

A: So far this year, three sale transactions under safe harbor, relying on four more transactions, total dollar amount depends on remaining transactions' size.

Q: Any thoughts on preferred units conversion?

A: Almost no chance of conversion, will likely pay off with cash from asset sales or borrowings, 99% probability not converted.

Q: What caused the pickup in variable payment expectations?

A: Due to crop dynamics, refining views on crop yields and prices, no lease restructuring.

Q: Is there a ceiling on loan portfolio as percentage of assets?

A: Don't want loan portfolio to be too big a percentage, core business is farmland ownership, won't expand significantly.

Q: Outlook on California water issues for other farms?

A: SGMA process mostly underway in water districts/counties, no immediate other farms at risk with similar issues