FRP Holdings, Inc. (NASDAQ:FRPH) Q3 2019 Earnings Conference Call Transcript

Nov 07, 2019 • 10:00 am ET

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FRP Holdings, Inc. (NASDAQ:FRPH) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for your patience in holding. We now have your speakers in conference. [Operator Instructions]

It is now my pleasure to turn today's conference over to John Baker. Sir, you may begin.

Executive
John D. Baker

Thank you and good morning. This is John Baker, and I am Chairman and CEO of FRP Holdings, Inc. With me today are David deVilliers Jr., our President; John Baker, the third, our CFO; John Milton, our General Counsel; and John Klopfenstein, our Chief Accounting Officer.

Let me caution those of you who are on the call that any statements made today which relate to the future are by their very nature, subject to risk and uncertainties that could cause actual results and events to differ materially from those indicated in such forward-looking statements. Additionally, I ask you to review the other risks listed in our SEC filings, including but not limited to our Annual and Quarterly reports.

Net income for the third quarter of 2019 was $2,001,000 or $0.20 per share, down from $2,224,000 or $0.22 per share in the same quarter of 2018. As you may recall, last year on May 21st, 2018, the Company completed the disposition of 40 industrial parcels and three additional land parcels to Blackstone for $347.2 million. Since that time, we have sold a warehouse that was excluded from the original transaction to Blackstone for $11.7 million and an office building for $8.9 million to a third party. We made this sale, because year-over-year returns on a build and hold industrial business had declined and prices for such assets were at an all time high.

Our job now is to redeploy those funds prudently and we're off to a good start. Before I turn it over to David deVilliers to walk you through the projects we're working on, I'd like to point out that our Mining Royalty properties continue to perform well. Revenue was up 8.3% for the quarter and the initiation of royalties on our Fort Myers property should bolster this segment going forward. This quarter marked a six consecutive quarter increase in mining revenues and the royalties collected in the first nine months are more than we collected in any year prior to 2017.

We've invested our cash in short-term bonds, money market funds and preferred equity on the Maren and Bryant Street projects. As of September 30, we have purchased 159,282 shares in 2019 at an average price of $48.43 per share. Net investment income including realized gains on some bonds that were called or sold were $2,019,000 for the quarter. Now David, would you please walk us through the projects we're working on to redeploy the proceeds from the warehouse sale?

Executive
David H. deVilliers

Thank you, John, and good day to those on the call this morning. Since John covered the highlights of the mining and royalty segment, let me jump into some of the ongoing activities and highlights for the quarter in our other business segments. So with the second quarter dispositions of our assets at