Company: EGP
Filing Date: 2025-10-23
Form Type: 10-Q
Source: 0000049600-25-000109
Chunk: 43

Company: EASTGROUP PROPERTIES INC
Filing Date: 2025-10-23
Form: 10-Q
Item: Part I, Item 1
Chunk 43
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 a means to raise capital.

Investors and industry analysts following the real estate industry primarily utilize two supplemental operating performance measures in analyzing the Company’s operating results: (1) funds from operations (“FFO”) attributable to common stockholders, and (2) property net operating income (“PNOI”).  

FFO is computed in accordance with standards established by the National Association of Real Estate Investment Trusts, Inc. (“Nareit”).  Nareit’s guidance allows preparers an option as it pertains to whether gains or losses on sale, or impairment charges, on real estate assets incidental to a REIT’s business are excluded from the calculation of FFO.  EastGroup has made the election to exclude activity related to such assets that are incidental to our business.    

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FFO is calculated as net income (loss) attributable to common stockholders computed in accordance with U.S. generally accepted accounting principles (“GAAP”), excluding gains and losses from sales of real estate property (including other assets incidental to the Company’s business) and impairment losses, adjusted for real estate related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures.  FFO is not considered as an alternative to net income (determined in accordance with GAAP) as an indication of the Company’s financial performance, nor is it a measure of the Company’s liquidity or indicative of funds available to provide for the Company’s cash needs, including its ability to make distributions.  The Company’s key drivers affecting FFO are changes in PNOI (as discussed below), interest rates, the amount of leverage the Company employs and general and administrative expenses.  

PNOI is defined as Income from real estate operations less Expenses from real estate operations (including market-based internal management fee expense) plus the Company’s share of income and property operating expenses from its less-than-wholly-owned real estate investments. 

EastGroup sometimes refers to PNOI from Same Properties as “Same PNOI”; the Company also presents Same PNOI, Excluding Income from Lease Terminations.  Same Properties is defined as operating properties owned during the entire current and prior year reporting periods.  Properties developed or acquired are excluded until held in the operating portfolio for both the current and prior year reporting periods.  Properties sold during the current or prior year reporting periods are also excluded.  For the three and nine months ended September 30, 2025, Same Properties includes properties which were included in the operating portfolio for the entire period