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NetSTREIT Corp. (NTST), a real estate investment trust (REIT) specializing in single-tenant, net-leased properties, released its unaudited financial statements for the second quarter ended June 30, 2023. The company reported an increase in revenue and provided insights into its net income/loss.
Net Income/Loss
NetSTREIT Corp. reported a net loss of $(792) thousand for the second quarter of 2023. This represents a decrease in net income compared to the same period last year when the company reported a net income of $2,010 thousand. The decline in net income was attributed to various factors, including increased operating expenses and interest expense, as well as the loss on debt extinguishment.
Revenue
During the second quarter of 2023, NetSTREIT Corp. witnessed growth in its revenue. The company's total revenues amounted to $31,630 thousand, compared to $22,634 thousand in the same quarter of the previous year. The increase in revenue can be attributed to higher rental revenue, including reimbursable amounts, as well as interest income on loans receivable.
Financial Performance
Despite the growth in revenue, NetSTREIT Corp. faced challenges in maintaining profitability during the second quarter. The increase in operating expenses, particularly in the property and general administrative categories, impacted the company's net income. Additionally, the interest expense on term loans and the loss on debt extinguishment further contributed to the net loss.
Financial Position
As of June 30, 2023, NetSTREIT Corp. had total assets amounting to $1,747,758 thousand, representing an increase compared to the December 31, 2022, total assets of $1,605,692 thousand. The rise in assets can be primarily attributed to an increase in real estate held for investment and mortgage loans receivables, offset by a decrease in cash, cash equivalents, and restricted cash.
On the liability side, the company's total liabilities as of June 30, 2023, amounted to $543,163 thousand, slightly lower than the $547,269 thousand reported on December 31, 2022. The decrease in liabilities was primarily driven by reductions in the revolving credit facility and liabilities related to assets held for sale.
NetSTREIT Corp. demonstrated an increase in revenue during the second quarter of 2023, reflecting the company's ability to generate income from its real estate investments and loans receivable. However, the net loss reported for the quarter highlights the challenges faced by the company in maintaining profitability due to higher operating expenses and interest costs. As the company continues to navigate market conditions and make strategic investments, investors will be keenly watching its financial performance in the coming quarters.