Agree Realty Corporation Reports Fourth Quarter and Full Year 2023 Results
Fourth Quarter ATM Activity Creates
Fourth Quarter 2023 Financial and Operating Highlights:
- Invested approximately
$199 million in 70 retail net lease properties - Completed four development or Developer Funding Platform ("DFP") projects representing total committed capital of over
$16 million - Net Income per share attributable to common stockholders of
$0.44 was unchanged year-over-year - Core Funds from Operations ("Core FFO") per share increased 3.4% to
$0.99 - Adjusted Funds from Operations ("AFFO") per share increased 5.2% to
$1.00 - Declared a December monthly dividend of
$0.247 per common share, a 2.9% year-over-year increase - Sold 3.8 million shares of common stock via the forward component of the Company's at-the-market equity ("ATM") program for net proceeds of approximately
$236 million - Balance sheet well positioned at 4.3 times proforma net debt to recurring EBITDA; 4.7 times excluding unsettled forward equity
Full Year 2023 Financial and Operating Highlights:
- Invested or committed
$1.34 billion in 319 retail net lease properties - Commenced 13 development or DFP projects for total committed capital of approximately
$54 million - Net Income per share attributable to common stockholders declined 7.0% to
$1.70 - Core FFO per share increased 1.6% to
$3.93 - AFFO per share increased 3.1% to
$3.95 - Declared dividends of
$2.919 per share, a 4.1% year-over-year increase - Raised over
$370 million of gross equity proceeds through the Company's ATM program - Closed on an unsecured
$350 million 5.5-year term loan at a 4.52% fixed rate inclusive of prior hedging activity - Ended the year with over
$1.0 billion of total liquidity including availability on the revolving credit facility, outstanding forward equity, and cash on hand
Financial Results
Net Income Attributable to Common Stockholders
Net Income for the three months ended
Net Income for the twelve months ended
Core FFO
Core FFO for the three months ended
Core FFO for the twelve months ended
AFFO
AFFO for the three months ended
AFFO for the twelve months ended
Dividend
In the fourth quarter, the Company declared monthly cash dividends of
For the twelve months ended
Subsequent to year end, the Company declared a monthly cash dividend of
Additionally, subsequent to year end, the Company declared a monthly cash dividend for each of January and
CEO Comments
"We are pleased with our performance in 2023 as we invested over
Portfolio Update
As of
At year end, the portfolio was 99.8% leased, had a weighted-average remaining lease term of approximately 8.4 years, and generated 69.1% of annualized base rents from investment grade retail tenants.
Ground Lease Portfolio
During the fourth quarter, the Company acquired seven ground leases for an aggregate purchase price of approximately
As of
At year end, the ground lease portfolio was fully occupied, had a weighted-average remaining lease term of approximately 10.5 years, and generated 88.0% of annualized base rents from investment grade retail tenants.
Acquisitions
Total acquisition volume for the fourth quarter was approximately
The properties were acquired at a weighted-average capitalization rate of 7.2% and had a weighted-average remaining lease term of approximately 10.1 years. Approximately 70.5% of annualized base rents acquired were generated from investment grade retail tenants.
For the twelve months ended
Dispositions
During the fourth quarter, the Company sold three properties for gross proceeds of approximately
Development and DFP
During the fourth quarter, the Company commenced four development or DFP projects, with total anticipated costs of approximately
For the twelve months ended
The following table presents estimated costs for the Company's active or completed development or DFP projects for the quarter and year ended
|
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
|
|
|
|
|
|
Number of Projects |
|
|
20 |
|
37 |
|
Costs Funded During Q4 2023 |
|
|
|
|
|
|
Costs Funded Prior to Q4 2023 |
|
|
32,772 |
|
102,694 |
|
Remaining Funding Costs |
|
|
35,593 |
|
35,593 |
|
Anticipated Total Project Costs |
|
|
|
|
|
|
|
||||||
Development and DFP project costs are in thousands.
Any differences are the result of rounding. Costs Funded |
Leasing Activity and Expirations
During the fourth quarter, the Company executed new leases, extensions or options on approximately 425,000 square feet of gross leasable area throughout the existing portfolio. Notable new leases, extensions or options included a 25,000-square foot TJ Maxx in
For the twelve months ended
As of
Year |
Leases |
|
Annualized |
|
Percent of |
|
Gross Leasable Area |
|
Percent of Gross |
|
|
|
|
|
|
|
|
|
|
2024 |
28 |
|
6,106 |
|
1.1 % |
|
722 |
|
1.6 % |
2025 |
73 |
|
17,153 |
|
3.1 % |
|
1,684 |
|
3.8 % |
2026 |
120 |
|
26,874 |
|
4.8 % |
|
2,769 |
|
6.3 % |
2027 |
155 |
|
34,038 |
|
6.1 % |
|
3,119 |
|
7.1 % |
2028 |
175 |
|
45,925 |
|
8.3 % |
|
4,155 |
|
9.5 % |
2029 |
182 |
|
55,189 |
|
9.9 % |
|
5,379 |
|
12.2 % |
2030 |
265 |
|
55,218 |
|
9.9 % |
|
4,240 |
|
9.7 % |
2031 |
180 |
|
42,434 |
|
7.6 % |
|
3,119 |
|
7.1 % |
2032 |
232 |
|
48,165 |
|
8.7 % |
|
3,559 |
|
8.1 % |
2033 |
193 |
|
45,005 |
|
8.1 % |
|
3,485 |
|
7.9 % |
Thereafter |
706 |
|
180,258 |
|
32.4 % |
|
11,691 |
|
26.7 % |
Total Portfolio |
2,309 |
|
|
|
100.0 % |
|
43,922 |
|
100.0 % |
|
|||||||||
The contractual lease expirations presented above exclude the effect of replacement tenant leases that had been executed as of |
|||||||||
|
|||||||||
(1)
Annualized Base Rent represents the annualized amount of contractual minimum rent required by tenant lease agreements as of |
Top Tenants
The following table presents annualized base rents for all tenants that represent 1.5% or greater of the Company's total annualized base rent as of
Tenant |
|
Annualized |
|
Percent of Annualized Base Rent |
|
|
|
|
|
Walmart |
|
|
|
6.1 % |
Tractor Supply |
|
28,155 |
|
5.1 % |
Dollar General |
|
26,831 |
|
4.8 % |
Best Buy |
|
19,515 |
|
3.5 % |
CVS |
|
17,310 |
|
3.1 % |
TJX Companies |
|
17,008 |
|
3.1 % |
Dollar Tree |
|
16,987 |
|
3.1 % |
Kroger |
|
16,315 |
|
2.9 % |
O'Reilly Auto Parts |
|
16,107 |
|
2.9 % |
|
|
14,637 |
|
2.6 % |
Lowe's |
|
14,025 |
|
2.5 % |
|
|
13,770 |
|
2.5 % |
|
|
12,431 |
|
2.2 % |
Sunbelt Rentals |
|
12,374 |
|
2.2 % |
|
|
11,880 |
|
2.1 % |
Sherwin-Williams |
|
11,423 |
|
2.1 % |
Wawa |
|
10,185 |
|
1.8 % |
Home Depot |
|
8,880 |
|
1.6 % |
BJ's Wholesale Club |
|
8,713 |
|
1.6 % |
Other(2) |
|
245,955 |
|
44.2 % |
Total Portfolio |
|
|
|
100.0 % |
|
||||
Annualized Base Rent is in thousands; any differences are the result of rounding. |
||||
(1) Refer to footnote 1 on page 5 for the Company's definition of Annualized Base Rent. |
||||
(2) Includes tenants generating less than 1.5% of Annualized Base Rent. |
Retail Sectors
The following table presents annualized base rents for all the Company's retail sectors as of
Sector |
|
Annualized |
|
Percent of Annualized Base Rent |
|
|
|
|
|
Grocery Stores |
|
|
|
9.6 % |
Home Improvement |
|
48,147 |
|
8.7 % |
Tire and Auto Service |
|
47,661 |
|
8.6 % |
Convenience Stores |
|
46,135 |
|
8.3 % |
Dollar Stores |
|
42,310 |
|
7.6 % |
Off-Price Retail |
|
34,920 |
|
6.3 % |
General Merchandise |
|
32,331 |
|
5.8 % |
Auto Parts |
|
31,636 |
|
5.7 % |
Farm and Rural Supply |
|
29,883 |
|
5.4 % |
Pharmacy |
|
23,701 |
|
4.3 % |
Consumer Electronics |
|
21,730 |
|
3.9 % |
Crafts and Novelties |
|
16,915 |
|
2.9 % |
Discount Stores |
|
14,399 |
|
2.6 % |
|
|
13,699 |
|
2.5 % |
Equipment Rental |
|
12,700 |
|
2.3 % |
Health Services |
|
11,085 |
|
2.0 % |
Dealerships |
|
10,276 |
|
1.7 % |
Restaurants - Quick Service |
|
9,215 |
|
1.7 % |
|
|
8,660 |
|
1.6 % |
Specialty Retail |
|
6,620 |
|
1.2 % |
Sporting Goods |
|
6,208 |
|
1.1 % |
Financial Services |
|
6,030 |
|
1.1 % |
Restaurants - Casual Dining |
|
5,594 |
|
1.0 % |
Home Furnishings |
|
4,001 |
|
0.7 % |
Theaters |
|
3,854 |
|
0.7 % |
|
|
3,430 |
|
0.6 % |
Beauty and Cosmetics |
|
3,233 |
|
0.6 % |
Shoes |
|
2,875 |
|
0.5 % |
Entertainment Retail |
|
2,323 |
|
0.4 % |
Apparel |
|
1,531 |
|
0.3 % |
Miscellaneous |
|
1,239 |
|
0.2 % |
|
|
784 |
|
0.1 % |
Total Portfolio |
|
|
|
100.0 % |
|
||||
Annualized Base Rent is in thousands; any differences are the result of rounding. |
||||
(1) Refer to footnote 1 on page 5 for the Company's definition of Annualized Base Rent. |
Geographic Diversification
The following table presents annualized base rents for all states that represent 1.5% or greater of the Company's total annualized base rent as of
State |
|
Annualized |
|
Percent of Annualized Base Rent |
|
|
|
|
|
|
|
|
|
|
|
7.2 % |
|
|
|
33,844 |
|
6.1 % |
|
|
|
30,816 |
|
5.5 % |
|
|
|
30,778 |
|
5.5 % |
|
|
|
29,341 |
|
5.3 % |
|
|
|
27,810 |
|
5.0 % |
|
|
|
26,126 |
|
4.7 % |
|
|
|
23,122 |
|
4.2 % |
|
|
|
22,191 |
|
4.0 % |
|
|
|
21,193 |
|
3.8 % |
|
|
|
20,564 |
|
3.7 % |
|
|
|
15,719 |
|
2.8 % |
|
|
|
15,270 |
|
2.7 % |
|
|
|
14,908 |
|
2.7 % |
|
|
|
14,033 |
|
2.5 % |
|
|
|
13,661 |
|
2.5 % |
|
|
|
12,762 |
|
2.3 % |
|
|
|
12,443 |
|
2.2 % |
|
|
|
12,379 |
|
2.2 % |
|
|
|
11,596 |
|
2.1 % |
|
|
|
11,274 |
|
2.0 % |
|
|
|
10,308 |
|
1.9 % |
|
|
|
9,419 |
|
1.7 % |
|
|
|
9,308 |
|
1.7 % |
|
|
|
8,448 |
|
1.5 % |
|
|
|
8,437 |
|
1.5 % |
|
|
|
8,367 |
|
1.5 % |
|
Other(2) |
|
62,152 |
|
11.2 % |
|
Total Portfolio |
|
|
|
100.0 % |
|
|
|||||
Annualized Base Rent is in thousands; any differences are the result of rounding. |
|||||
(1) Refer to footnote 1 on page 5 for the Company's definition of Annualized Base Rent. |
|||||
(2) Includes states generating less than 1.5% of Annualized Base Rent. |
Capital Markets, Liquidity and Balance Sheet
Capital Markets
During the fourth quarter, the Company entered into forward sale agreements in connection with its ATM program to sell an aggregate of 3,833,871 shares of common stock for net proceeds of approximately
The following table presents the Company's outstanding forward equity offerings as of
Forward Equity |
|
Shares |
|
Shares |
|
Shares |
|
Net |
|
Anticipated |
|
|
|
|
|
|
|
|
|
|
|
Q4 2023 ATM Forward Offerings |
|
3,833,871 |
|
- |
|
3,833,871 |
|
- |
|
|
Total Forward Equity Offerings |
|
3,833,871 |
|
- |
|
3,833,871 |
|
- |
|
|
Liquidity
As of
Balance Sheet
As of
The Company's total debt to enterprise value was 27.2% as of
For the three and twelve months ended
For the three and twelve months ended
The Company's assets are held by, and its operations are conducted through, the
Conference Call/Webcast
The Company will host its quarterly analyst and investor conference call on
Additionally, a webcast of the conference call will be available through the Company's website. To access the webcast, visit www.agreerealty.com ten minutes prior to the start time of the conference call and go to the Investors section of the website. A replay of the conference call webcast will be archived and available online through the Investors section of www.agreerealty.com.
About
Forward-Looking Statements
This press release contains forward-looking statements
, including statements about projected financial and operating results,
within the meaning of
Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions.
Forward-looking statements are generally identifiable by use of forward-looking terminology such as "may," "will," "should," "potential," "intend," "expect," "seek," "anticipate," "estimate," "approximately," "believe," "could," "project," "predict," "forecast," "continue," "assume," "plan," "outlook" or other similar words or expressions. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections or other forward-looking information. Although these forward-looking statements are based on good faith beliefs, reasonable assumptions and the Company's best judgment reflecting current information, you should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company's control and which could materially affect the Company's results of operations, financial condition, cash flows, performance or future achievements or events. Currently, some of the most significant factors, include the potential adverse effect of ongoing worldwide economic uncertainties and increased inflation and interest rates on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market and the global economy and financial markets. The extent to which these conditions will impact the Company and its tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence. Moreover, investors are cautioned to interpret many of the risks identified in the risk factors discussed in the Company's Annual Report on Form 10-K and subsequent quarterly reports filed with the
For further information about the Company's business and financial results, please refer to the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" sections of the Company's
The Company defines the "weighted-average capitalization rate" for acquisitions and dispositions as the sum of contractual fixed annual rents computed on a straight-line basis over the primary lease terms and anticipated annual net tenant recoveries, divided by the purchase and sale prices for occupied properties.
References to "Core FFO" and "AFFO" in this press release are representative of Core FFO attributable to OP common unitholders and AFFO attributable to OP common unitholders. Detailed calculations for these measures are shown in the Reconciliation of Net Income to FFO, Core FFO and Adjusted FFO table as "Core Funds From Operations – OP Common Unitholders" and "Adjusted Funds from Operations – OP Common Unitholders".
|
|||
Consolidated Balance Sheet |
|||
($ in thousands, except share and per-share data) |
|||
(Unaudited) |
|||
|
|
|
|
Assets: |
|
|
|
Real Estate Investments: |
|
|
|
Land |
$ 2,282,354 |
|
$ 1,941,599 |
Buildings |
4,861,692 |
|
4,054,679 |
Accumulated depreciation |
(433,958) |
|
(321,142) |
Property under development |
33,232 |
|
65,932 |
Net real estate investments |
6,743,320 |
|
5,741,068 |
Real estate held for sale, net |
3,642 |
|
- |
Cash and cash equivalents |
10,907 |
|
27,763 |
Cash held in escrows |
3,617 |
|
1,146 |
Accounts receivable - tenants, net |
82,954 |
|
65,841 |
Lease Intangibles, net of accumulated amortization of |
854,088 |
|
799,448 |
Other assets, net |
76,308 |
|
77,923 |
Total Assets |
$ 7,774,836 |
|
$ 6,713,189 |
|
|
|
|
Liabilities: |
|
|
|
Mortgage notes payable, net |
42,811 |
|
47,971 |
Unsecured term loans, net |
346,798 |
|
- |
Senior unsecured notes, net |
1,794,312 |
|
1,792,047 |
Unsecured revolving credit facility |
227,000 |
|
100,000 |
Dividends and distributions payable |
25,534 |
|
22,345 |
Accounts payable, accrued expenses and other liabilities |
101,401 |
|
83,722 |
Lease intangibles, net of accumulated amortization of |
36,827 |
|
36,714 |
Total Liabilities |
$ 2,574,683 |
|
$ 2,082,799 |
|
|
|
|
Equity: |
|
|
|
Preferred Stock, |
175,000 |
|
175,000 |
Common stock, |
10 |
|
9 |
Additional paid-in-capital |
5,354,120 |
|
4,658,570 |
Dividends in excess of net income |
(346,473) |
|
(228,132) |
Accumulated other comprehensive income (loss) |
16,554 |
|
23,551 |
Total Equity - |
$ 5,199,211 |
|
$ 4,628,998 |
Non-controlling interest |
942 |
|
1,392 |
Total Equity |
$ 5,200,153 |
|
$ 4,630,390 |
Total Liabilities and Equity |
$ 7,774,836 |
|
$ 6,713,189 |
|
|
|
|
|
|
|||||||||||
Consolidated Statements of Operations and Comprehensive Income |
|
|||||||||||
($ in thousands, except share and per share-data) |
|
|||||||||||
(Unaudited) |
|
|||||||||||
|
Three months ended
|
|
Twelve months ended
|
|||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||
Revenues |
|
|
|
|
|
|
|
|||||
Rental Income |
$ 144,144 |
|
$ 116,496 |
|
$ 537,403 |
|
$ 429,632 |
|
||||
Other |
21 |
|
35 |
|
92 |
|
182 |
|||||
Total Revenues |
$ 144,165 |
|
$ 116,531 |
|
$ 537,495 |
|
$ 429,814 |
|||||
|
|
|
|
|
|
|
|
|||||
Operating Expenses |
|
|
|
|
|
|
|
|||||
Real estate taxes |
$ 10,663 |
|
$ 7,962 |
|
$ 40,092 |
|
$ 32,079 |
|||||
Property operating expenses |
6,841 |
|
5,010 |
|
24,961 |
|
18,585 |
|||||
Land lease expense |
412 |
|
404 |
|
1,664 |
|
1,617 |
|||||
General and administrative |
8,701 |
|
7,856 |
|
34,788 |
|
30,121 |
|||||
Depreciation and amortization |
47,257 |
|
37,904 |
|
176,277 |
|
133,570 |
|||||
Provision for impairment |
2,665 |
|
- |
|
7,175 |
|
1,015 |
|||||
Total Operating Expenses |
$ 76,539 |
|
$ 59,136 |
|
$ 284,957 |
|
$ 216,987 |
|||||
|
|
|
|
|
|
|
|
|||||
Gain (loss) on sale of assets, net |
1,550 |
|
15 |
|
1,849 |
|
5,341 |
|||||
Gain (loss) on involuntary conversion, net |
- |
|
82 |
|
- |
|
(83) |
|||||
|
|
|
|
|
|
|
|
|||||
Income from Operations |
$ 69,176 |
|
$ 57,492 |
|
$ 254,387 |
|
$ 218,085 |
|||||
|
|
|
|
|
|
|
|
|||||
Other (Expense) Income |
|
|
|
|
|
|
|
|||||
Interest expense, net |
$ (22,371) |
|
$ (16,843) |
|
$ (81,119) |
|
$ (63,435) |
|||||
Income tax (expense) benefit |
(709) |
|
(723) |
|
(2,910) |
|
(2,860) |
|||||
Other (expense) income |
5 |
|
1,113 |
|
189 |
|
1,245 |
|||||
|
|
|
|
|
|
|
|
|||||
Net Income |
$ 46,101 |
|
$ 41,039 |
|
$ 170,547 |
|
$ 153,035 |
|||||
|
|
|
|
|
|
|
|
|||||
Less net income attributable to non-controlling interest |
146 |
|
113 |
|
588 |
|
598 |
|||||
|
|
|
|
|
|
|
|
|||||
Net Income Attributable to |
$ 45,955 |
|
$ 40,926 |
|
$ 169,959 |
|
$ 152,437 |
|||||
|
|
|
|
|
|
|
|
|||||
Less Series A Preferred Stock Dividends |
1,859 |
|
1,859 |
|
7,437 |
|
7,437 |
|||||
|
|
|
|
|
|
|
|
|||||
Net Income Attributable to Common Stockholders |
$ 44,096 |
|
$ 39,067 |
|
$ 162,522 |
|
$ 145,000 |
|||||
|
|
|
|
|
|
|
|
|||||
Net Income Per Share Attributable to Common Stockholders |
|
|
|
|
|
|
|
|||||
Basic |
$ 0.44 |
|
$ 0.44 |
|
$ 1.70 |
|
$ 1.84 |
|||||
Diluted |
$ 0.44 |
|
$ 0.44 |
|
$ 1.70 |
|
$ 1.83 |
|||||
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|||||
Other Comprehensive Income |
|
|
|
|
|
|
|
|||||
Net Income |
$ 46,101 |
|
$ 41,039 |
|
$ 170,547 |
|
$ 153,035 |
|||||
Amortization of interest rate swaps |
(630) |
|
(575) |
|
(2,519) |
|
(684) |
|||||
Change in fair value and settlement of interest rate swaps |
(16,165) |
|
- |
|
(4,501) |
|
29,881 |
|||||
Total Comprehensive Income (Loss) |
29,306 |
|
40,464 |
|
163,527 |
|
182,232 |
|||||
Less comprehensive income attributable to non-controlling interest |
88 |
|
111 |
|
565 |
|
741 |
|||||
Comprehensive Income Attributable to |
$ 29,218 |
|
$ 40,353 |
|
$ 162,962 |
|
$ 181,491 |
|||||
|
|
|
|
|
|
|
|
|||||
Weighted Average Number of Common Shares Outstanding - Basic |
100,279,279 |
|
88,434,580 |
|
95,191,409 |
|
78,659,333 |
|||||
Weighted Average Number of Common Shares Outstanding - Diluted |
100,397,096 |
|
88,812,510 |
|
95,437,412 |
|
79,164,386 |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Reconciliation of Net Income to FFO, Core FFO and Adjusted FFO |
|
|||||||||||||||||||
($ in thousands, except share and per-share data) |
|
|||||||||||||||||||
(Unaudited) |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three months ended
|
|
Twelve months ended
|
|
||||||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Net Income |
$ 46,101 |
|
$ 41,039 |
|
$ 170,547 |
|
$ 153,035 |
|
||||||||||||
Less Series A Preferred Stock Dividends |
1,859 |
|
1,859 |
|
7,437 |
|
7,437 |
|
||||||||||||
Net Income attributable to OP Common Unitholders |
44,242 |
|
39,180 |
|
163,110 |
|
145,598 |
|
||||||||||||
Depreciation of rental real estate assets |
31,119 |
|
24,843 |
|
115,617 |
|
88,685 |
|
||||||||||||
Amortization of lease intangibles - in-place leases and leasing costs |
15,611 |
|
12,800 |
|
58,967 |
|
44,107 |
|
||||||||||||
Provision for impairment |
2,665 |
|
- |
|
7,175 |
|
1,015 |
|
||||||||||||
(Gain) loss on sale or involuntary conversion of assets, net |
(1,550) |
|
(97) |
|
(1,849) |
|
(5,258) |
|
||||||||||||
Funds from Operations - OP Common Unitholders |
$ 92,087 |
|
$ 76,726 |
|
$ 343,020 |
|
$ 274,147 |
|
||||||||||||
|
|
|
8,556 |
|
33,430 |
|
33,563 |
|
||||||||||||
Core Funds from Operations - OP Common Unitholders |
$ 99,651 |
|
$ 85,282 |
|
$ 376,450 |
|
$ 307,710 |
|
||||||||||||
Straight-line accrued rent |
(3,200) |
|
(3,757) |
|
(12,142) |
|
(13,176) |
|
||||||||||||
Stock based compensation expense |
2,158 |
|
1,572 |
|
8,338 |
|
6,464 |
|
||||||||||||
Amortization of financing costs and original issue discounts |
1,186 |
|
1,071 |
|
4,403 |
|
3,141 |
|
||||||||||||
Non-real estate depreciation |
527 |
|
261 |
|
1,693 |
|
778 |
|
||||||||||||
Adjusted Funds from Operations - OP Common Unitholders |
$ 100,322 |
|
$ 84,429 |
|
$ 378,742 |
|
$ 304,917 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Funds from Operations Per Common Share and OP Unit - Basic |
$ 0.92 |
|
$ 0.86 |
|
$ 3.59 |
|
$ 3.47 |
|
||||||||||||
Funds from Operations Per Common Share and OP Unit - Diluted |
$ 0.91 |
|
$ 0.86 |
|
$ 3.58 |
|
$ 3.45 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Core Funds from Operations Per Common Share and OP Unit - Basic |
$ 0.99 |
|
$ 0.96 |
|
$ 3.94 |
|
$ 3.89 |
|
||||||||||||
Core Funds from Operations Per Common Share and OP Unit - Diluted |
$ 0.99 |
|
$ 0.96 |
|
$ 3.93 |
|
$ 3.87 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted Funds from Operations Per Common Share and OP Unit - Basic |
$ 1.00 |
|
$ 0.95 |
|
$ 3.96 |
|
$ 3.86 |
|
||||||||||||
Adjusted Funds from Operations Per Common Share and OP Unit - Diluted |
$ 1.00 |
|
$ 0.95 |
|
$ 3.95 |
|
$ 3.83 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted Average Number of Common Shares and OP Units Outstanding - Basic |
100,626,898 |
|
88,782,199 |
|
95,539,028 |
|
79,006,952 |
|
||||||||||||
Weighted Average Number of Common Shares and OP Units Outstanding - Diluted |
100,744,715 |
|
89,160,129 |
|
95,785,031 |
|
79,512,005 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Additional supplemental disclosure |
|
|
|
|
|
|
|
|
||||||||||||
Scheduled principal repayments |
$ 232 |
|
$ 217 |
|
$ 905 |
|
$ 850 |
|
||||||||||||
Capitalized interest |
288 |
|
445 |
|
1,957 |
|
1,261 |
|
||||||||||||
Capitalized building improvements |
3,122 |
|
968 |
|
9,819 |
|
7,945 |
|
Non-GAAP Financial Measures |
||||||||||||||||||||
|
||||||||||||||||||||
Funds from Operations ("FFO" or "Nareit FFO")
|
||||||||||||||||||||
|
||||||||||||||||||||
Core Funds from Operations ("Core FFO")
|
||||||||||||||||||||
|
||||||||||||||||||||
Adjusted Funds from Operations ("AFFO")
|
|
|
|
||||||||||||||||||
|
Reconciliation of Net Debt to Recurring EBITDA |
|
||||||||||||||||||
|
($ in thousands, except share and per-share data) |
|
||||||||||||||||||
|
(Unaudited) |
|
||||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Three months ended |
|
||||||||||||||||||
|
2023 |
|
||||||||||||||||||
|
|
|
||||||||||||||||||
|
Net Income |
$ 46,101 |
|
|||||||||||||||||
|
Interest expense, net |
22,371 |
|
|||||||||||||||||
|
Income tax expense |
709 |
|
|||||||||||||||||
|
Depreciation of rental real estate assets |
31,119 |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Non-real estate depreciation |
527 |
|
|||||||||||||||||
|
Provision for impairment |
2,665 |
|
|||||||||||||||||
|
(Gain) loss on sale or involuntary conversion of assets, net |
(1,550) |
|
|||||||||||||||||
|
EBITDAre |
$ 117,553 |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Run-Rate Impact of Investment, Disposition and Leasing Activity |
$ 2,344 |
|
|||||||||||||||||
|
Amortization of above (below) market lease intangibles, net |
7,481 |
|
|||||||||||||||||
|
Recurring EBITDA |
$ 127,378 |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Annualized Recurring EBITDA |
$ 509,512 |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Total Debt |
$ 2,431,868 |
|
|||||||||||||||||
|
Cash, cash equivalents and cash held in escrows |
(14,524) |
|
|||||||||||||||||
|
Net Debt |
$ 2,417,344 |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Net Debt to Recurring EBITDA |
4.7x |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Net Debt |
$ 2,417,344 |
|
|||||||||||||||||
|
Anticipated Net Proceeds from ATM Forward Offerings |
(235,619) |
|
|||||||||||||||||
|
Proforma Net Debt |
$ 2,181,725 |
|
|||||||||||||||||
|
|
|
|
|||||||||||||||||
|
Proforma Net Debt to Recurring EBITDA |
4.3x |
|
|
Non-GAAP Financial Measures |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
EBITDAre
EBITDAre is defined by Nareit to mean net income computed in accordance with GAAP, plus interest expense, income tax expense, depreciation and amortization, any gains (or losses) from sales of real estate assets |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
Recurring EBITDA
The Company defines Recurring EBITDA as EBITDAre with the addback of noncash amortization of above- and below- market lease intangibles, and after adjustments for the run-rate impact of the Company's investment and |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
Net Debt
The Company defines Net Debt as total debt principal outstanding less cash, cash equivalents and cash held in escrows. The Company considers the non-GAAP measure of Net Debt to be a key supplemental measure of the |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
Forward Offerings
The Company has 3,833,871 shares remaining to be settled under the ATM Forward Offerings. Upon settlement, the offerings are anticipated to raise net proceeds of approximately |
|
||||||||||
Rental Income |
||||||||||
($ in thousands, except share and per share-data) |
||||||||||
(Unaudited) |
||||||||||
|
Three months ended
|
|
Twelve months ended
|
|||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
||
Rental Income Source(1) |
|
|
|
|
|
|
|
|
||
Minimum rents(2) |
$ 133,274 |
|
$ 109,227 |
|
$ 497,736 |
|
$ 402,117 |
|
||
Percentage rents(2) |
- |
|
- |
|
1,314 |
|
723 |
|
||
Operating cost reimbursement(2) |
15,151 |
|
11,986 |
|
59,307 |
|
46,953 |
|
||
Straight-line rental adjustments(3) |
3,200 |
|
3,757 |
|
12,142 |
|
13,176 |
|
||
Amortization of (above) below market lease intangibles(4) |
(7,481) |
|
(8,474) |
|
(33,096) |
|
(33,337) |
|
||
Total Rental Income |
$ 144,144 |
|
$ 116,496 |
|
$ 537,403 |
|
$ 429,632 |
|
(1) The Company adopted Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") 842 "Leases" using the modified retrospective approach as of |
||||||||||
(2) Represents contractual rentals and/or reimbursements as required by tenant lease agreements, recognized on an accrual basis of accounting. The Company believes that the presentation of contractual lease income is not, and is not intended to be, a presentation in accordance with GAAP. The Company believes this information is frequently used by management, investors, analysts and other interested parties to evaluate the Company's performance. |
||||||||||
(3) Represents adjustments to recognize minimum rents on a straight-line basis, consistent with the requirements of FASB ASC 842. |
||||||||||
(4) In allocating the fair value of an acquired property, above- and below-market lease intangibles are recorded based on the present value of the difference between the contractual amounts to be paid pursuant to the leases at the time of acquisition and the Company's estimate of current market lease rates for the property. |
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