Q4 2022 Farmland Partners Inc Earnings Call
Thank you for standing by today's conference will be starting shortly.
For your patience today.
[music].
Erez.
Welcome to the farmland partners, Inc. Q4, 2022, adding scope at this time all participants are in a listen only mode.
A brief question and session will follow the formal presentation. Please press star one on your telephone keypad to ask a question.
If you change your mind to any time, please press star two.
Operator.
All right.
Now, let me turn the call over to cool Pittman, Chairman and CEO .
You may begin.
Great Good morning, and welcome to the farmland partners fourth quarter and full year 2022 earnings conference call and webcast. We appreciate you taking the time to join US for these calls we see them as an important opportunity to share with you our thinking and our strategy and our form.
Format, less formal and more interactive than public filings and press releases I will now turn it over to our general counsel Kristine garrison for some customary preliminary remarks, Christine. Thank you Paul and thank you to everyone on the call. The press release announcing our fourth quarter earnings was distributed after market closed yesterday.
Supplemental package have been posted to the Investor Relations section of our website under the sub head or events and presentation for those who listen to the recording of this presentation. We remind you that the remarks made herein are as of today February 23, 2023 and will not be updated subsequent to this call. During this call we will make forward looking statements.
Including statements related to the future performance of our portfolio, our identified and potential acquisitions and dispositions impact of acquisitions dispositions and financing activities business development opportunities as well as comments on our outlook for our business rents and the broader agricultural market. We will also discuss certain non-GAAP .
<unk> financial measures, including net operating income <unk> adjusted <unk> EBITDA and adjusted EBITDA definitions of these non-GAAP measures as well as reconciliations to the most comparable GAAP measures are included in the company's press release announcing fourth quarter and full year earnings which is available on our web.
At site and is furnished as an exhibit to our current report on form 8-K dated February 22023 listeners are cautioned that these statements are subject to certain risks and uncertainties many of which are difficult to predict and generally beyond our control. These risks and uncertainties can cause actual results to differ materially from our current expectation.
And we advise listeners to review the risk factors discussed in our press release distributed yesterday and in documents, we have filed with or furnished to the SEC.
I'd now like to turn the call to <unk>.
Luca Fabbri Luca.
Thank you Christine I.
I will make some very brief remarks about the year behind us.
2022, and it's been a very strong year for U S. Agriculture in general and our company talked about partners in particular.
Global events has really highlighted throughout 2022.
Key roles of U S agricultural plays in addressing global food demand.
A blessing of geography, but also thanks to be absolute world class infrastructure.
Okay.
And the pool of talent the USB Bolshoi enjoys.
Hi, especially on the row crop side.
High yields and high prices have led to strong P&L.
Farmers.
There's been some increases due to inflation in certain.
Finally inputs, but the biggest cost factor increase in businesses in general in 2022 liter of suites is only affected U S. Agriculture as a whole relatively marginally because of the very low leverage in the industry in the low teens.
These strong farmer profitability is.
And profitability of the whole sector has translated into.
Strong pricing for farmland in general as an asset class, which of course, we have greatly benefited from but also.
It has helped the company had a very strong.
Renewal season for what our rights.
In the specifically in the rents that we rolled especially on the fixed cash rents you go crops, we have seen increases of 16% across the board.
For the ones that renewed multi agenda for Spi its been a strong year, we were able to.
De lever significantly earlier in the year as we were looking down the pike.
The interest rate increases we were able to strengthen.
Relationships with our.
Lenders will be seen in a very very strong liquidity position.
I mentioned the strong rent renewals.
On the negative side, we have faced despite delevering, how your interest costs. So of course that have impacted our P&L.
But also we are experiencing permanent crops, a little bit of the opposite.
We have <unk> row crops.
Our portfolio.
Helps us.
Heavily weighted in California, which has experienced several years of drought meeting too.
Excuse me leading to low yields while at the same time.
Globally, there has been <unk>.
<unk> crop markets have experienced a combination of all.
Low demand still do Beleaguering COVID-19 impacts as well as <unk>.
High yields.
Overall, our acquisition activity in 2022 has been.
Somewhat modest.
Lastly, due to the high cost of capital.
<unk> in that.
We have been very choosy.
Physicians.
So we have been able to actually capture the.
A potential transaction that were particularly attractive.
With that I will pass the floor to our chairman and CEO , Paul Pittman for some remarks on the outlook.
Thank you Luca.
So it's sort of a bad deal here that Luca gets to talk about last year, which was pretty strong year and I get to talk about next year, which will be quite a bit of a challenge.
But.
Really where we are is.
Because we have faced as Lucas said.
Significant drought.
In California.
That drought is as you all know sort of behind us in the sense that it has been incredibly rainy and snowy on the west coast.
Problem as it translates into our P&L and obviously the stock price. This morning is reflecting this is that there is a substantial tail of revenue.
That comes from those specialty crops in the following year.
The lack of rainfall behind us.
Will lead to a relatively challenged specialty crop performance and the 2023 calendar year.
That added with the increased cost of interest rates is what's doing the damage to our <unk> for the 2023 year as you see in the guidance.
That being said it does sort of set the stage for what hopefully would be a pretty strong 2024, because we're going to see us.
Substantial return in specialty crop volumes little hard to predict price, but we will see volumes recover substantially but that doesn't have an effect. Unfortunately until 2024.
So thinking kind of broadly about what's occurring here farmland has two components of return.
It always has and its the current yield and the asset appreciation.
The asset appreciation is probably the bigger of the two.
And we have seen very very strong asset appreciation.
Certainly amongst our row crop properties and despite the drought probably to some degree even among the specialty crops inflation drives farmland values up without question.
What we're very disappointed about and I'm.
Huge shareholder so I am personally very frustrated with is all of the very strong things happening in the farm economy, and therefore in our portfolio.
On the row crop side.
Are being are being taken away.
By the volatility the negative volatility at this point in time.
On the specialty crop side.
This is leading to stock price that fundamentally vastly undervalues the portfolio, we own some of the best farmland in the world.
And we are trading at a very large discount.
That being said.
From a from an investor's perspective and from my perspective as a stockholder.
We've got to do something to stop having the relatively smaller piece of our assets, 20% to 25% of our assets are in these specialty crops.
Being the tail wagging the dog.
This is the boom times for row crop. It will go on for at least another year on the row crop side and we've got as I said negative the negative effect of volatility on the specialty crop side, what thats frankly, causing us to do is seriously evaluate.
Given where we want to be as a company has a stable long term store of value.
We should continue to be involved in the specialty crop business.
It's important to remember that.
A couple of years ago.
<unk> side of our business was the engine of <unk> and was performing quite strongly and there is this ebb and flow.
But as I said the volatility caused in the specialty crop side of the business and there is sort of no structure, you could could set up to take that away.
Or at least not very very many structures that could take it away is really hurting the underlying story.
That is so powerful and so successful on the row crop side, it's really sort of a.
Almost a tale of two different industries in terms of our what's happening to the underlying tenant base and operations of the two businesses and therefore.
The effect on our rents from the two different sides of the business.
The.
The best value in farm land today in my opinion is we were here a few years ago and we're here again, the best value out there in the market is frankly, our stock we can buy high quality farmland through our stock.
Better than we can do.
By buying farms. So it's something we need to really kind of focus on as a company.
The.
So my perspective is that the underlying farm economy is very strong on the overwhelming majority of our assets the row crop side.
That the specialty crop side will substantially.
We recover.
Because of the drought has been lessened quite a bit this winter, but the P&L impact of that recovery is unfortunately, not going to really show up until the 2024 year.
During Q&A, obviously willing to go deeper into this and what we're seeing out there and what we intend to try to do.
But I'm going to turn it over to James to go through.
Comments regarding.
Past quarter.
Past year performance.
Thank you Paul.
I'm going to cover a number of items today, including summary of full year 2022 in Q4, 2022 review of capital structure and interest rates greater detail on revenue buildup and guidance for 2023.
I'll refer to the supplemental package in my comments as Christine said the supplemental is available on the Investor Relations section of our website under the subheading events and presentations.
First I'll share a few financial metrics that appear on page two.
For the 12 months ended December 31, 2022, net income was $12 million compared to $10 3 million for 'twenty, one an increase of $1 7 million.
Net income per share available to common stockholders was positive 16 compared to negative 17, 21, an increase of 33 zones.
<unk> was $15 8 million compared to <unk> 4 million for 'twenty, one an increase of $15 4 million.
<unk> per weighted average share was <unk> 30, compared to <unk> for 21, an increase of 29.
Improved performance was due to increased fixed rents increased brokerage and auction revenue reduced litigation expense and reduced distributions on the preferred stock.
Cost of goods sold was higher in 2022 due to the greater number of farms in our direct operations in 2022 compared to 2021.
General and administrative expenses were higher in 2022, largely due to the acquisition of Marine Wise associates for MW as we say internally in late 2021.
For the three months ended December 31, 2022, net income was $6 7 million compared to $13 3 million for Q4, 'twenty. One a decrease of $6 6 million. It should be noted that gain on disposition of assets was $7 $2 million lower than Q4 2022 compared to Q4 2021 accounting for all of the decrease.
And net income between the periods.
Net income per share available to common stockholders was <unk> 11, compared to 2014 for Q4 'twenty one a decrease of <unk> again.
Again this was impacted by the difference in gain on disposition of assets as noted a moment ago.
<unk> was 10.0 million compared to $8 9 million for Q4 dollars 21, an increase of $1 1 million.
<unk> per weighted average share was <unk> 18, compared to <unk> 19 for Q4, 'twenty one a decrease of one.
Q4 hundred 22 showed higher fixed brands management fees interest income direct operations profit and lower litigation spend compared to Q4 2021, those items were offset by lower variable rents increased general and administrative expenses and higher property operating expenses largely due to higher state franchise taxes.
Higher property taxes, and higher insurance premiums.
Next I'll Skip ahead to page 13 to make a couple of comments about our capital structure.
Total debt at December 31, 2022 was $439 5 million.
Since December 31, 2021, where we have reduced debt by over $70 million.
Fully diluted share count as of February 17th was $55 6 million shares.
If you look at the table on the bottom of the page between the Metlife credit facility and the Rutledge Farm credit mid America credit facility, we have undrawn capacity in excess of $160 million today.
As shown in previous quarters, we have approximately $174 million of Metlife debt with rates that reset in 2023. These are low numbers 14567 and 10.
The notes at the bottom of the page show the four loans, representing approximately $109 million of that $174 million that have already been agreed to.
$5 million has been reset to 563%.
$104 million has been reset to 555%.
Reset loans also have increased flexibility to prepay without penalty up to 40% of original principal balance per year.
Next I will turn to page 14 to provide an overview of our income statement.
Over the last year, we presented numbers in categories shown on the top table on page 14 Fitch.
Fixed payments variable payments direct operations gross profit and other items.
This was an effort to make the business easier to understand however, this presentation may have made it a little difficult to model out the business because it did not detail out the building blocks that comprised the different categories.
The second table on page 14 does just that it shows the building blocks for both GAAP revenue line items and supplemental categories, bringing across the Roes that you can see what makes up the supplemental categories and reading down the columns you can see what makes up the GAAP line items.
15 shows these building blocks described on the previous page for 2021, and 2022 by quarter with comments at the bottom of the page to describe the differences between the periods. A few points to highlight are fixed farm rent increased as we acquired properties and renewed leases and decreased with dispositions.
<unk> increased in 2022 is a large project in the state of Illinois commenced its construction phase tenant reimbursements declined with asset dispositions and firms that converted to direct operations.
Management fees increased as we manage more acres for third parties in 2022 compared to 2021.
In Q4, 2022, we acquired land in billings for for agricultural equipment dealerships in Ohio under the John Deere brand.
Counting treatment classifies as acquisitions as financing transactions.
On the balance sheet they appear as loans.
On the income statement impacts interest income.
This accounts for the increase in interest income in the fourth quarter of 2022.
Variable payments were down due to lower performance in tree nuts in grapes caused by lower prices and yields during the Q4 harvest.
In addition, citrus farms that produce variable payments in 2021 converted to direct operations in 2022.
Direct operations is a combination of crop sales crop insurance cost of goods sold.
It was up in 2022 because of the citrus farms that converted to direct operations as mentioned a moment ago.
Other items increased for the full year of auction in brokerage activity in 2022 compared to 2021.
At the bottom of the table, we show the increase in fixed payments on same row crop farms. When we talked about the same row crop farms, we mean row crop farms that were in the portfolio before the beginning of the periods being compared or in this case January one 2021 does not include specialty crop farms acquisitions dispositions or other non comparable farms.
Between the periods. This group was up approximately $1 million between the years.
Next on page 16, we compare the guidance range from October to actual performance with notes at the bottom of the page.
Direct operations gross profit was lower than expected due to lower pricing and yields in the Q4 harvest period and crop insurance payments of a lag into 2023.
Property operating expenses were up compared to expectations due to the required credit allowance on the Ohio AG equipment dealership acquisitions higher than projected state franchise taxes in the fourth quarter and higher than projected property taxes in the fourth quarter.
On the next page page 17, we have the outlook for 2023 using those same building blocks described on page 14.
On the revenue side fixed farm rent increases due to new leases signed and farms acquired in 2022 that will contribute a full year in 2023.
Solar wind and recreation or up slightly while tenant reimbursements will be pretty consistent with 2022.
Interest income increases with a full year's contribution from the Ohio equipment dealerships mentioned before.
The variable payments indirect operations are decreasing in 2023.
The decrease in variable direct operations is due to the items Paul noted in his comments lower yields due to weather.
Poor pricing due to supply demand imbalances.
On the expense side property operating expenses are increasing due to assumptions of higher property tax and higher insurance premiums.
G&A is in line with 2022.
Legal and accounting decreases with lower litigation spend.
<unk> spend will be down from approximately $1 3 million in 2022 to an estimate of $250000 in 2023.
Interest expense is up due to higher base rates on floating rate debt and interest reset that will occur.
Already occurred in 2023.
The bottom of the page provides greater detail on the assumptions behind the interest rate interest expense.
We use forward curves from Bloomberg and estimated remaining 2023 resets at three year treasuries plus historical spreads.
This result in <unk> and the nine three to $13 $5 million range compared to $15 $8 million in 2022.
<unk> per share in the range of 17 to 24.
Compared to 30 in 2022.
This wraps up my comments. This morning, Thank you all for participating.
Later, you can now begin the Q&A session.
Thank you.
We would like to ask a question please.
Please press Star then one on your kind of thank you Pat.
If you change your mind anytime.
Got you.
So pricing.
Clint.
Scott.
Thanks.
We now have the first question.
Okay.
Please go ahead your line is open.
Yeah.
Yeah, Hey, good morning out there Paul I wanted to start with your comments around the specialty crops and your belief that thats, obviously, having a pretty big negative impact on the stock recently and today.
It seems like NOI in the guidance is actually not that far off and maybe a little lower than anticipated, but certainly the interest expense is more disappointing and I think you've communicated some of that but I guess what gives you the sense that the specialty crops are the big drag on the portfolio.
And then I guess, maybe a follow up to that is if you chose to sell those and reinvest that capital how would you do that.
Yes.
Look this is something we're evaluating so no one should take from our comments that we are going to exit specialty crop, but we're certainly considering it so here's.
Big picture and I'm using these things a little bit anecdotally. So please don't take exactly the number and go model it.
But in the leases we rolled over on the row crop side Luca alluded to this and I think James did as well, we got a 16% average increase on the fixed cash rents on the row crop that we rolled over.
The new three year leases and if you recall last year, we got approximately 10% I think when we did those roll something in that range. So on the row crop side.
It's incredibly high inflation.
Strong yields on the crops and high crop prices due to worldwide shortages of these key commodities.
Is driving us to have an increasing.
Positive returns and results growing rents essentially.
And rapidly appreciating asset values on the row crop side.
When we turn to the specialty crop side.
What we are experiencing.
And it's it's mixed up and complicated unravel because of all the specialty crops with the exception of citrus the most of the revenue or a large portion of the revenue.
<unk> is up in the next year in these long marketing tails.
So the negative the negative impact of the drought.
Is really having a 2023 impact equal to or greater than the drought impact in 2000 during the 2022 financial year.
The 23 year gets hurt by the 'twenty two drought.
And then and then on top of that what has happened is in many of these crops. We had a big crop coming off the 21 year, we've got excess supply in many parts of the world on the tree nuts, especially so you've got this double whammy as we.
<unk> during the 23 year of relatively low yield due to the drought and frankly yell at relatively low price due to the supply demand imbalances.
On a worldwide basis.
So back to your core of your question is.
What diversification has gotten us.
Is there something bad going on somewhere all the time.
And it is very frustrating to me as a shareholder and as the chairman and CEO .
And what we want to try to do is figure out a way to substantially dampen that volatility because you've been with us Dave for for many years now as an analyst on the company.
And what happens on the row crop.
Syed on the back in the Bad times, we've lived through them in your 15 through 19 basically too busy in 2019, you're talking about.
Maybe you can't get a rent increase but youre not talking about big rent decreases and the reason is it's fixed cash rent and so.
Bad error in the row crop side and it will come again.
Doesn't drastically reduce and create volatility in our P&L, especially.
The specialty crop side because of the nature of the way those leases are.
And if we get these big swings and I think it's frankly, hurting us and it's hurting the price of the stock. So we've got to figure out how to have that.
To have that stop happening.
It might be might be joint ventures might be dispositions might be.
Some other way of structuring our leases there is a lot of choices.
But we got it we got to get that problem to frankly go away.
That answered your question.
Yes, I appreciate that color and I wanted to go back to one other comment you made with whether you've thought about two thirds of the value of owning a farm over time as the appreciation in the land and I guess I wonder what.
Where you think cap rates are going in yields have moved and I think maybe part of that question comes from the fact that you are repricing that into the mid to high fives, which is largely now consistent with where your implied cap rate is so I'm curious again, how you view kind of the underlying foreign market and prices moving there with the aggressive move in that cost.
We've seen.
Yes.
The good news in many respects is that.
Farmland market. It has continued to appreciate.
Even with higher interest rates.
These high interest rates will gradually put a damper on prices.
Common sense in history suggests they must.
But it hasnt really occurred yet and it is.
What I say put a damper on it will stop the growth of the asset values. It wont probably reverse it very much if at all on the row crop side and the reason for that is the overwhelming amount of these purchases are done with cash.
The farmers are quite profitable.
Farmers drive the asset values on the row crop side not institutions.
And so they bought farms those farms are very strong hands.
And so I, just don't think you're going to see ASP.
Asset values come off with high interest rates and we certainly haven't seen it happen yet on the row crop side.
Institutions like us and us in particular, because thats, what what I know about.
Besides these high cap rates have really dampened the amount of purchasing we are doing of new farms and its going to until the cost of capital goes back down and when it's hard for us to buy farms at a negative spread even though we're very confident that five 5% or greater average annual appreciation of row crop farmland will continue I mean thats.
This statistic that's in place now for more than 50 years, it's not going to change, but it's hard for us as a public company to be in the market when our cost of debt capital is as an excess or equal to five 5%.
<unk>.
Back to the cap rates on the underlying assets.
The problem is as you take high quality, Illinois farmland. It is trading today at a two and a half cap.
And I.
I don't see that changing.
As a counter cyclical asset class when you get right down to it it's not really driven by <unk>.
Wall Street or institutional money, it's driven by.
Small town Rural America money, primarily.
Worldwide food demand clines supply demand volatility of the key commodities around the world is high and so Ukraine, South American drought.
Lines of other issues, so high quality U S. Farmland is continuing to be viewed by the people that drive the underlying asset value is a very very good investment.
Great store of capital a great long term wealth creator.
Got to do is figure out how to get that to convert into our stock price and unfortunately, we're not communicating that very well.
Some reason and part of it is.
Volatility on the specialty crop side.
Alright, I appreciate all the details Paul Thanks.
Thanks.
Thank you. Your next question comes from Steve Rob Stevenson.
Thanks.
Please go ahead.
Yes. Good morning. This is Steven asking for Rob Stevenson just wanted to see if you could please provide more insight on the for agricultural equipment dealership acquisitions.
Yes, So we acquired we acquired.
For the we acquired the real estate not the operations, we acquired the real estate underneath for different John Deere dealerships in Ohio.
The operator of those dealerships is a company called AG Pro.
AG Pro is the largest John Deere dealership network in the United States. They have something in excess of I think 18 separate dealerships, we bought those four dealerships.
Driving.
Reason to do that transaction is really several several key points first as a cap rate and the return on those on those is pretty strong certainly stronger current yield.
Then you experience.
On.
On farmland in most cases, certainly on row crop farmland second big driver is that was that we frankly feel like those those dealerships are in locations, particularly a couple of them, where we get pretty pretty good long term appreciation of the underlying asset.
John Deere dealerships are really tied strongly to the row crop farm economy in particular, we think it matches up with our with our general.
Sort of thesis that row crop farmland is very valuable. It will continue to appreciate the value. We think these assets appreciated value credit quality of the tenants, obviously, obviously quite high.
But in addition, it networks us through that dealer network to a whole lot more farmers a whole lot more relationships.
Frankly kind of wrapping ourself in the flag of John Deere, a little bit.
In terms of how we can reach out to farmers that use that dealer network and that's one of the strongest brands in the World frankly is certainly the strongest with the strongest brand in agriculture. So theres a lot of sort of synergistic benefits to cracking that door opening an opening in and making some investments in that sector.
But it will not be the key.
Core of our business by any means that will remain a tiny percentage of what we do because what we really want to focus on most is the is really the.
Row crop farmland and high quality farm assets generally that appreciate over time.
Really the core of our long term story.
Yes.
Thank you that's very helpful.
Thank you as a reminder, star one to ask one more question.
And our next question comes from the line of Steve on the Cherokee.
Thank you.
Yes, Hey, good morning, guys.
Apologize if I missed this there is a lot of calls going on right now but.
James I know that you had the debt resets here.
You announced in the press release that are resetting here in the first quarter. How are you thinking about dealing with the remaining resets in 'twenty three and then 2004 swaps or interest caps come into play.
Yes, we've looked at that a little bit our assumptions or are we kind of noted them in the in the supplemental where we provide guidance.
We're kind of looking at is we're looking at the forward curves and we're also using kind of historical spreads.
To think about sort of how those how those will likely reset when we come upon those dates.
So thats, how we kind of model amount, we have had a lot of conversations with not only the incumbent lender, but also potential new lenders on ways too.
Sort of deal with that debt into different fashion.
So we're continuing to bring competition to bear where we can frankly again everyone's good ideas and.
Approach those resets with all the all the arrows in our quicker than we can.
Got it and Paul I know that you tend to take a very long term look as most farmers do on the asset value and how to think about things and your guidance has maybe.
25% to $50 million of asset sales, but does it make sense maybe.
To increase those sales when you can sell at such a deep discount.
Debt costs, and maybe improve the per share results or how do you kind of think about that as we earn a higher interest rate environment.
So yes, we do certainly think about asset sales all the time.
And look we balance a variety of things when we think about asset sales.
First is are we getting a really good price and a fair value for the asset we own and that Youre correct.
There's a lot of there's a lot of money flowing out there into this asset class and cap rates are low and we could sell assets and buy back stock.
Our philosophy generally don't sell what we call the crown jewels type farms because of a plus farm or in a farm and the reason is it's almost impossible to buy that step back unless you.
Paid dearly from a financial point of view, but.
If it is a farm that has kind of been underperforming or its a farm that were not in love with we're actually looking at many many asset sales.
Don't want to sort of over predict a certain amount, which is why you see the guidance where it is.
I think we are.
Pretty dedicated to trimming parts of the portfolio that where we can get a profit and redeploy that capital into debt reduction or frankly into stock buybacks given what's happened this morning.
Alright, Thanks, guys appreciate the color.
Thank you.
Jeff can you ask a question. Please go ahead, Doug in London.
As he has had no further question I'd like to Cook Chairman.
Kevin <unk>.
Thank you. Thank you all for joining us for this phone call today I am as disappointed in the stock price performance. This morning as many of you are.
I think it is important to keep things in perspective from a financial point of view 2022 was a very strong year.
2023, as we have predicted will be a more challenging year, but that is the nature of production agriculture.
Those sounds trite, but.
That grow these crops outdoors, and so we will be a subject of.
Which has happened here.
Volatility driven by weather and commodity pricing.
On the other hand, it is the long term averages up performance in the sector that drive farmland asset values and long term return.
And we all we all know is that global food demand and.
It continues to go up and therefore dimmed.
Demand for <unk>.
Farmland will continue to go up and we are seeing that in terms of asset value appreciation that asset value appreciation is frankly, probably all still occurring in the specialty crop side of the portfolio just not as rapidly.
As it is occurring in the row crop side, and even though you have a year.
Year of tough performance in terms of crop yields and things like that.
The long term demand for almonds, and pistachios and citrus is still a worldwide positive outlook and so I don't think youre going to see.
Significant reductions in asset values, but youre going to see a challenging 12 months period of time in terms of the P&L in front of us and we will get through this it will be a.
Real positive long term story and it will continue to be so on the row crop side in particular, given what continues to happen with production around the world.
And what's going on in Ukraine Slash Russia.
U S farmland in U S and demand for U S.
Farm crops will remain elevated in our opinion for the next 12 months at least and that'll be positive for the rent rolls. We do in the 2023 year for example, with that I'll conclude and thank you all for your time.
Thank you for joining that does conclude today's call. Please have a lovely day you may now disconnect your line.
[music].