Cousins Properties Incorporated (NYSE:CUZ) Q1 2023 Results Conference Call April 28, 2023 11:00 AM ET

Company Participants

Pamela Roper - General Counsel

Colin Connolly - President and Chief Executive Officer

Richard Hickson - Executive Vice President of Operations

Gregg Adzema - Chief Financial Officer

Conference Call Participants

Blaine Heck - Wells Fargo

Anthony Powell - Barclays

John Kim - BMO Capital

Dylan Burzynski - Green Street

Camille Bonnel - Bank of America

Operator

Good day, and welcome to the Cousins Properties First Quarter Conference Call [Operator Instructions]. Please note that this event is being recorded. I would like to turn the conference over to Ms. Pamela Roper, General Counsel. Please go ahead.

Pamela Roper

Thank you. Good morning. And welcome to Cousins Properties first quarter earnings conference call. With me today are Colin Connolly, our President and Chief Executive Officer; Richard Hickson, our Executive Vice President of Operations; and Gregg Adzema, our Chief Financial Officer. The press release and supplemental package were distributed yesterday afternoon as well as furnished on Form 8-K. In the supplemental package, the company has reconciled all non-GAAP financial measures to the most directly comparable GAAP measures in accordance with Reg G requirements. If you did not receive a copy, these documents are available through the quarterly disclosures and supplemental SEC information links on the Investor Relations page of our Web site, www.cousins.com. Please be aware that certain matters discussed today may constitute forward-looking statements within the meaning of federal securities laws, and actual results may differ materially from these statements due to a variety of risks and uncertainties and other factors, including the risk factors set forth in our annual report on Form 10-K and our other SEC filings. The company does not undertake any duty to update any forward-looking statements, whether as a result of new information, future events or otherwise. The full declaration regarding forward-looking statements is available in the supplemental package posted yesterday and a detailed discussion of some potential risks is contained in our filings with the SEC.

With that, I'll turn the call over to Colin Connolly.

Colin Connolly

Thank you, Pam, and good morning, everyone. We had a solid first quarter at Cousins and a productive start to 2023. On the earnings front, the team delivered $0.65 per share in FFO and same property net operating income increased 4.9% on a cash basis. We leased 258,000 square feet during the quarter with a 6.1% cash rent roll-up. New leases and expansions totaled 159,000 square feet. And our renewals were modest, as we have minimal near term lease expirations. Overall, these are positive results in a tough economy. Over 10 years ago, Cousins set out to build the premier Sun Belt Trophy REIT, while maintaining a fortress balance sheet. Our unique and compelling strategy has been supported by two powerful secular trends, a migration to the Sun Belt and the flight to quality. We aggressively positioned the company around these tailwinds. In just the last five years, we sold approximately $1.3 billion of predominantly older vintage properties and reinvested the proceeds in trophy acquisitions and attractive new developments. In addition, we completed a transformational merger with TIER REIT that expanded the portfolio and enhanced our geographic diversification. As a result, Cousins now owns a premier portfolio located in the best submarkets across the Sun Belt. Importantly, our portfolio is among the newest across the office sector with among the lowest near term lease expirations. In addition, our balance sheet is among the strongest in the office sector with a net debt-to-EBITDA at 5.1 times with ample liquidity and no significant debt maturities until July of 2025.