Essential Properties Announces First Quarter 2021 Results | Financial Buzz

Essential Properties Announces First Quarter 2021 Results

Essential Properties Realty Trust, Inc. (NYSE: EPRT; “Essential Properties” or the “Company”), today announced operating results for the three months ended March 31, 2021.

First Quarter 2021 Financial and Operating Highlights

Operating Results (as compared to First Quarter 2020):

 

 

  • Investments (74 properties)

$ Invested

$197.8 million

 

Weighted Avg Cash Cap Rate

7.0%

  • Net Income per share

Decreased by 7%

$0.14

  • Funds from Operations (“FFO”) per share

Increased by 7%

$0.30

  • Core Funds from Operations (“Core FFO”) per share

Remained unchanged

$0.30

  • Adjusted Funds from Operations (“AFFO”) per share

Increased by 3%

$0.30

Equity Activity:

 

 

  • Equity Raised – ATM Program

$23.22/share

$64.9 million

Highlights Subsequent to First Quarter 2021

  • Investments (19 properties)

$ Invested

$45.6 million

  • Dispositions (4 properties)

$ Gross Proceeds

$4.8 million

Equity Activity:

 

 

  • Equity Raised – ATM Program

$23.45/share

$2.4 million

  • Equity Raised – Follow-On Offering (April 15th, 2021)

$23.50/share

$193.2 million

CEO Comments

Commenting on the first quarter 2021 results, Essential Properties’ President and Chief Executive Officer, Pete Mavoides, said, “We are pleased with our first quarter results, particularly the continuation of the key trends that drove our robust fourth quarter results, including the increased stability of our portfolio, strong investment activity, and attractively priced capital raising.” Mr. Mavoides added, “With regards to our $198 million quarterly investment activity, 81% were prior relationship transactions and 85% were direct sale-leasebacks, which speaks to the consistency of our team and our disciplined investment approach. We remain optimistic that these favorable dynamics can continue through 2021 and beyond.”

Portfolio Update

Investments

The Company’s investment activity during the three months ended March 31, 2021 is summarized as follows:

 

Quarter Ended

March 31, 2021

Investments:

 

$ Invested

$197.8 million

# of Properties

74

# of Separate Transactions

22

Weighted Average Cash and GAAP Cap Rate

7.0%/7.9%

WALT

16.1 years

% Sale-Leaseback Transactions

85%

% Subject to Master Lease

79%

% Required Financial Reporting (tenant/guarantor)

100%

Dispositions

The Company’s disposition activity during the three months ended March 31, 2021 is summarized as follows:

 

 

Quarter Ended

March 31, 2021

Dispositions:

 

 

Net Proceeds

 

$25.2 million

# of Properties Sold

 

16

Net Gain / (Loss)

 

$3.8 million

Weighted Average Cash Cap Rate (excluding vacant properties)

 

7.1%

Portfolio Highlights

The Company’s investment portfolio as of March 31, 2021 is summarized as follows:

Number of properties

1,240

Weighted average lease term

14.3 years

Weighted average rent coverage ratio

3.0x

Number of tenants

259

Number of states

43

Number of industries

17

Weighted average occupancy

99.1%

Total square feet of rentable space

10,801,149

Cash ABR – service-oriented or experience-based

95.3%

Cash ABR – properties subject to master lease

59.9%

Leverage and Balance Sheet and Liquidity

The Company’s leverage, balance sheet and liquidity are summarized in the following table. Pro forma adjustments have been made to reflect the impact of the Company’s April 2021 follow-on offering of common stock. On April 15, 2021, the Company issued 8,222,500 shares of common stock for proceeds of $185.5 million, net of underwriters’ discounts.

 

 

March 31, 2021

 

Pro Forma

March 31, 2021

Leverage:

 

 

 

 

Net debt to Annualized Adjusted EBITDAre

 

5.1x

 

4.1x

 

 

 

 

 

Balance Sheet and Liquidity:

 

 

 

 

Cash and cash equivalents and restricted cash

 

$44.8 million

 

$230.3 million

Unused borrowing capacity

 

$262.0 million

 

$262.0 million

Total available liquidity

 

$306.8 million

 

$492.3 million

 

 

 

 

 

ATM Program:

 

 

 

 

2020 ATM Program availability

 

$250.0 million

 

 

Aggregate gross sales under the 2020 ATM Program

 

$144.2 million

 

 

Availability remaining under the 2020 ATM Program

 

$105.8 million

 

 

Dividend Information

As previously announced, on March 5, 2021 Essential Properties’ board of directors declared a cash dividend of 0.24 per share of common stock for the quarter ended March 31, 2021. The dividend was paid on April 15, 2021 to stockholders of record as of the close of business on March 31, 2021.

2021 Guidance

The Company reiterates its previously issued expectation that 2021 AFFO per share on a fully diluted basis will be within a range of $1.22 to $1.26.

Conference Call Information

In conjunction with the release of Essential Properties’ operating results, the Company will host a conference call on Tuesday, May 4, 2021 at 10:00 a.m. EDT to discuss the results. To access the conference, dial 877-407-9208 (International: 201-493-6784). A live webcast will also be available in listen-only mode by clicking on the webcast link in the Investor Relations section at www.essentialproperties.com.

A telephone replay of the conference call can also be accessed by calling 844-512-2921 (International: 412-317-6671) and entering the access code: 13719029. The telephone replay will be available through May 18, 2021.

A replay of the conference call webcast will be available on our website approximately two hours after the conclusion of the live broadcast. The webcast replay will be available for 90 days. No access code is required for this replay.

Supplemental Materials

The Company’s Supplemental Operating & Financial Data—First Quarter Ended March 31, 2021 is available on Essential Properties’ website at investors.essentialproperties.com.

About Essential Properties Realty Trust, Inc.

Essential Properties Realty Trust, Inc. is an internally managed REIT that acquires, owns and manages primarily single- tenant properties that are net leased on a long-term basis to companies operating service-oriented or experience-based businesses. As of March 31, 2021, the Company’s portfolio consisted of 1,240 freestanding net lease properties with a weighted average lease term of 14.3 years and a weighted average rent coverage ratio of 3.0x. In addition, as of March 31, 2021, the Company’s portfolio was 99.1% leased to 259 tenants operating 367 different concepts in 17 industries across 43 states.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. When used in this press release, the words “estimate,” “anticipate,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “seek,” “approximately” or “plan,” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters are intended to identify forward-looking statements. You can also identify forward-looking statements by discussions of strategy, plans or intentions of management. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and the Company may not be able to realize them. The Company does not guarantee that the transactions and events described will happen as described (or that they will happen at all). You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this press release. While forward-looking statements reflect the Company’s good faith beliefs, they are not guarantees of future performance. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events, except as required by law. In light of these risks and uncertainties, the forward-looking events discussed in this press release might not occur as described, or at all.

Additional information concerning factors that could cause actual results to differ materially from these forward-looking statements is contained in the company’s Securities and Exchange Commission (the “Commission”) filings, including, but not limited to, the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Copies of each filing may be obtained from the Company or the Commission. Such forward-looking statements should be regarded solely as reflections of the Company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release.

The results reported in this press release are preliminary and not final. There can be no assurance that these results will not vary from the final results reported in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 that it will file with the Commission.

Non-GAAP Financial Measures and Certain Definitions

The Company’s reported results are presented in accordance with GAAP. The Company also discloses the following non-GAAP financial measures: FFO, Core FFO, AFFO, earnings before interest, taxes, depreciation and amortization (“EBITDA”), EBITDA further adjusted to exclude gains (or losses) on sales of depreciable property and real estate impairment losses (“EBITDAre”), adjusted EBITDAre, annualized adjusted EBITDAre, net debt, net operating income (“NOI”) and cash NOI (“Cash NOI”). The Company believes these non-GAAP financial measures are industry measures used by analysts and investors to compare the operating performance of REITs.

FFO, Core FFO and AFFO

The Company computes FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”). NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate-related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), including the pro rata share of such adjustments of unconsolidated subsidiaries. FFO is used by management, and may be useful to investors and analysts, to facilitate meaningful comparisons of operating performance between periods and among the Company’s peers primarily because it excludes the effect of real estate depreciation and amortization and net gains and losses on sales (which are dependent on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions).

The Company computes Core FFO by adjusting FFO, as defined by NAREIT, to exclude certain GAAP income and expense amounts that it believes are infrequent and unusual in nature and/or not related to its core real estate operations. Exclusion of these items from similar FFO-type metrics is common within the equity REIT industry, and management believes that presentation of Core FFO provides investors with a metric to assist in their evaluation of our operating performance across multiple periods and in comparison to the operating performance of our peers, because it removes the effect of unusual items that are not expected to impact our operating performance on an ongoing basis.

Core FFO is used by management in evaluating the performance of our core business operations. Items included in calculating FFO that may be excluded in calculating Core FFO include certain transaction related gains, losses, income or expense or other non-core amounts as they occur.

To derive AFFO, the Company modifies its computation of Core FFO to include other adjustments to GAAP net income related to certain items that it believes are not indicative of the Company’s operating performance, including straight-line rental revenue, non-cash interest expense, non-cash compensation expense, other amortization expense, other non-cash charges (including changes to our provision for loan losses following the adoption of ASC 326), capitalized interest expense and transaction costs. Such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. The Company believes that AFFO is an additional useful supplemental measure for investors to consider when assessing the Company’s operating performance without the distortions created by non-cash items and certain other revenues and expenses.

FFO, Core FFO and AFFO do not include all items of revenue and expense included in net income, they do not represent cash generated from operating activities and they are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Additionally, our computation of FFO, Core FFO and AFFO may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs.

EBITDA and EBITDAre

The Company computes EBITDA as earnings before interest, income taxes and depreciation and amortization. In 2017, NAREIT issued a white paper recommending that companies that report EBITDA also report EBITDAre. The Company computes EBITDAre in accordance with the definition adopted by NAREIT. NAREIT defines EBITDAre as EBITDA (as defined above) excluding gains (or losses) from the sales of depreciable property and real estate impairment losses. The Company presents EBITDA and EBITDAre as they are measures commonly used in its industry and the Company believes that these measures are useful to investors and analysts because they provide supplemental information concerning its operating performance, exclusive of certain non-cash items and other costs. The Company uses EBITDA and EBITDAre as measures of its operating performance and not as measures of liquidity.

EBITDA and EBITDAre do not include all items of revenue and expense included in net income, they do not represent cash generated from operating activities and they are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Additionally, the Company’s computation of EBITDA and EBITDAre may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs.

Net Debt

The Company calculates its net debt as its gross debt (defined as total debt plus net deferred financing costs on its secured borrowings) less cash and cash equivalents and restricted cash available for future investment. The Company believes excluding cash and cash equivalents and restricted cash available for future investment from gross debt, all of which could be used to repay debt, provides an estimate of the net contractual amount of borrowed capital to be repaid, which it believes is a beneficial disclosure to investors and analysts.

NOI and Cash NOI

The Company computes NOI as total revenues less property expenses. NOI excludes all other items of expense and income included in the financial statements in calculating net income or loss. Cash NOI further excludes non-cash items included in total revenues and property expenses, such as straight-line rental revenue and other amortization and non-cash charges. The Company believes NOI and Cash NOI provide useful information because they reflect only those revenue and expense items that are incurred at the property level and present such items on an unlevered basis.

NOI and Cash NOI are not measures of financial performance under GAAP. You should not consider the Company’s NOI and Cash NOI as alternatives to net income or cash flows from operating activities determined in accordance with GAAP. Additionally, the Company’s computation of NOI and Cash NOI may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs.

Adjusted EBITDAre / Adjusted NOI / Adjusted Cash NOI

The Company further adjusts EBITDAre, NOI and Cash NOI i) based on an estimate calculated as if all investment and disposition activity that took place during the quarter had occurred on the first day of the quarter, ii) to exclude certain GAAP income and expense amounts that the Company believes are infrequent and unusual in nature and iii) to eliminate the impact of lease termination fees and contingent rental revenue from its tenants which is subject to sales thresholds specified in the lease. The Company then annualizes these estimates for the current quarter by multiplying them by four, which it believes provides a meaningful estimate of the Company’s current run rate for all investments as of the end of the current quarter. You should not unduly rely on these measures, as they are based on assumptions and estimates that may prove to be inaccurate. The Company’s actual reported EBITDAre, NOI and Cash NOI for future periods may be significantly less than these estimates of current run rates.

Cash ABR

Cash ABR means annualized contractually specified cash base rent in effect as of the end of the current quarter for all of the Company’s leases (including those accounted for as direct financing leases) commenced as of that date and annualized cash interest on its mortgage loans receivable as of that date.

Cash Cap Rate

Cash Cap Rate means annualized contractually specified cash base rent for the first full month after investment or disposition divided by the purchase or sale price, as applicable, for the property.

GAAP Cap Rate

GAAP Cap Rate means annualized rental income computed in accordance with GAAP for the first full month after investment divided by the purchase price, as applicable, for the property.

Rent Coverage Ratio

Rent coverage ratio means the ratio of tenant-reported or, when unavailable, management’s estimate based on tenant-reported financial information, annual EBITDA and cash rent attributable to the leased property (or properties, in the case of a master lease) to the annualized base rental obligation as of a specified date.

Disclaimer

Essential Properties Realty Trust, Inc. and the Essential Properties Realty Trust REIT are not affiliated with or sponsored by Griffin Capital Essential Asset Operating Partnership, L.P. or the Griffin Capital Essential Asset REIT, information about which can be obtained at (https://www.gcear.com).

 

Essential Properties Realty Trust, Inc.

Consolidated Statements of Operations

 

 

 

Three months ended March 31,

(in thousands, except share and per share data)

 

2021

 

2020

 

 

(unaudited)

 

(unaudited)

Revenues:

 

 

 

 

Rental revenue1,2

 

$

45,432

 

 

$

39,542

 

Interest on loans and direct financing leases

 

3,105

 

 

1,938

 

Other revenue

 

15

 

 

7

 

Total revenues

 

48,552

 

 

41,487

 

 

 

 

 

 

Expenses:

 

 

 

 

General and administrative3

 

6,431

 

 

7,536

 

Property expenses4

 

1,414

 

 

373

 

Depreciation and amortization

 

15,646

 

 

13,012

 

Provision for impairment of real estate

 

5,722

 

 

373

 

Provision for loan losses

 

38

 

 

468

 

Total expenses

 

29,251

 

 

21,762

 

Other operating income:

 

 

 

 

Gain on dispositions of real estate, net

 

3,788

 

 

1,875

 

Income from operations

 

23,089

 

 

21,600

 

Other (expense)/income:

 

 

 

 

Loss on repayment of secured borrowings5

 

 

 

(924

)

Interest expense

 

(7,678

)

 

(6,833

)

Interest income

 

20

 

 

231

 

Income before income tax expense

 

15,431

 

 

14,074

 

Income tax expense

 

56

 

 

31

 

Net income

 

15,375

 

 

14,043

 

Net income attributable to non-controlling interests

 

(80

)

 

(84

)

Net income attributable to stockholders

 

$

15,295

 

 

$

13,959

 

 

 

 

 

 

Basic weighted-average shares outstanding

 

106,986,308

 

 

90,322,402

 

Basic net income per share

 

$

0.14

 

 

$

0.15

 

 

 

 

 

 

Diluted weighted-average shares outstanding

 

108,055,741

 

 

91,332,297

 

Diluted net income per share

 

$

0.14

 

 

$

0.15

1.

 

Includes contingent rent (based on a percentage of the tenant’s gross sales at the leased property) of $169 and $192 for the three months ended March 31, 2021 and 2020, respectively.

2.

 

Includes reimbursable income from the Company’s tenants of $453 and $165 for the three months ended March 31, 2021 and 2020, respectively.

3.

 

During the three months ended March 31, 2020, includes non-recurring expenses of $652 for costs and charges incurred in connection with the departure of one of our executive officers.

4.

 

Includes reimbursable expenses from the Company’s tenants $452 and $165 for the three months ended March 31, 2021 and 2020, respectively.

5.

 

Includes the write-off of $924 of deferred financing costs during the three months ended March 31, 2020.

 

Essential Properties Realty Trust, Inc.

Consolidated Balance Sheets

 

(in thousands, expect share and per share amounts)

 

March 31, 2021

 

December 31, 2020

 

 

(Unaudited)

 

(Audited)

ASSETS

 

 

 

 

Investments:

 

 

 

 

Real estate investments, at cost:

 

 

 

 

Land and improvements

 

$

790,395

 

 

$

741,254

 

Building and improvements

 

1,631,763

 

 

1,519,665

 

Lease incentive

 

14,192

 

 

14,297

 

Construction in progress

 

4,029

 

 

3,908

 

Intangible lease assets

 

83,030

 

 

80,271

 

Total real estate investments, at cost

 

2,523,409

 

 

2,359,395

 

Less: accumulated depreciation and amortization

 

(150,835

)

 

(136,097

)

Total real estate investments, net

 

2,372,574

 

 

2,223,298

 

Loans and direct financing lease receivables, net

 

176,025

 

 

152,220

 

Real estate investments held for sale, net

 

 

 

17,058

 

Net investments

 

2,548,599

 

 

2,392,576

 

Cash and cash equivalents

 

42,842

 

 

26,602

 

Restricted cash

 

1,974

 

 

6,388

 

Straight-line rent receivable, net

 

41,475

 

 

37,830

 

Rent receivables, prepaid expenses and other assets, net

 

27,827

 

 

25,406

 

Total assets

 

$

2,662,717

 

 

$

2,488,802

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

Secured borrowings, net of deferred financing costs

 

$

170,161

 

 

$

171,007

 

Unsecured term loans, net of deferred financing costs

 

626,450

 

 

626,272

 

Revolving credit facility

 

138,000

 

 

18,000

 

Intangible lease liabilities, net

 

10,046

 

 

10,168

 

Dividend payable

 

26,398

 

 

25,703

 

Derivative liabilities

 

20,893

 

 

38,912

 

Accrued liabilities and other payables

 

16,486

 

 

16,792

 

Total liabilities

 

1,008,434

 

 

906,854

 

Commitments and contingencies

 

 

 

 

Stockholders’ equity:

 

 

 

 

Preferred stock, $0.01 par value; 150,000,000 authorized; none issued and outstanding as of March 31, 2021 and December 31, 2020

 

 

 

 

Common stock, $0.01 par value; 500,000,000 authorized; 109,171,639 and 106,361,524 issued and outstanding as of March 31, 2021 and December 31, 2020, respectively

 

1,092

 

 

1,064

 

Additional paid-in capital

 

1,753,847

 

 

1,688,540

 

Distributions in excess of cumulative earnings

 

(88,635

)

 

(77,665

)

Accumulated other comprehensive loss

 

(19,248

)

 

(37,181

)

Total stockholders’ equity

 

1,647,056

 

 

1,574,758

 

Non-controlling interests

 

7,227

 

 

7,190

 

Total equity

 

1,654,283

 

 

1,581,948

 

Total liabilities and equity

 

$

2,662,717

 

 

$

2,488,802

 

 

Essential Properties Realty Trust, Inc.

Reconciliation of Non-GAAP Financial Measures

 

 

 

Three months ended March 31,

(unaudited, in thousands except per share amounts)

 

2021

 

2020

Net income

 

$

15,375

 

 

$

14,043

 

Depreciation and amortization of real estate

 

15,621

 

 

12,988

 

Provision for impairment of real estate

 

5,722

 

 

373

 

Gain on dispositions of real estate, net

 

(3,788

)

 

(1,875

)

Funds from Operations

 

32,930

 

 

25,529

 

Other non-recurring expenses1

 

 

 

1,576

 

Core Funds from Operations

 

32,930

 

 

27,105

 

Adjustments:

 

 

 

 

Straight-line rental revenue, net

 

(3,644

)

 

(3,191

)

Non-cash interest expense

 

479

 

 

534

 

Non-cash compensation expense

 

1,595

 

 

1,291

 

Other amortization expense

 

1,105

 

 

434

 

Other non-cash charges

 

36

 

 

468

 

Capitalized interest expense

 

(20

)

 

(95

)

Transaction costs

 

 

 

67

 

Adjusted Funds from Operations

 

$

32,481

 

 

$

26,613

 

 

 

 

 

 

Net income per share2:

 

 

 

 

Basic

 

$

0.14

 

 

$

0.15

 

Diluted

 

$

0.14

 

 

$

0.15

 

FFO per share2:

 

 

 

 

Basic

 

$

0.31

 

 

$

0.28

 

Diluted

 

$

0.30

 

 

$

0.28

 

Core FFO per share2:

 

 

 

 

Basic

 

$

0.31

 

 

$

0.30

 

Diluted

 

$

0.30

 

 

$

0.30

 

AFFO per share2:

 

 

 

 

Basic

 

$

0.30

 

 

$

0.29

 

Diluted

 

$

0.30

 

 

$

0.29

 

1.

 

Includes non-recurring expenses of $652 for accruals of severance payments and acceleration of non-cash compensation expense in connection with the departure of one of our executive officers and our $924 loss on repayment of secured borrowings during the three months ended March 31, 2020.

2.

 

Calculations exclude $119 and $130 from the numerator for the three months ended March 31, 2021 and 2020, respectively, related to dividends paid on unvested restricted share awards and restricted share units.

 

Essential Properties Realty Trust, Inc.

Reconciliation of Non-GAAP Financial Measures

 

 

(in thousands)

 

Three months ended

March 31, 2021

Net income

 

$

15,375

 

Depreciation and amortization

 

15,646

 

Interest expense

 

7,678

 

Interest income

 

(20

)

Income tax expense

 

56

 

EBITDA

 

38,735

 

Provision for impairment of real estate

 

5,722

 

Gain on dispositions of real estate, net

 

(3,788

)

EBITDAre

 

40,669

 

Adjustment for current quarter re-leasing, acquisition and disposition activity1

 

2,987

 

Adjustment to exclude other non-recurring expenses2

 

123

 

Adjusted EBITDAre – Current Estimated Run Rate

 

43,779

 

General and administrative

 

6,431

 

Adjusted net operating income (“NOI”)

 

50,210

 

Straight-line rental revenue, net1

 

(3,374

)

Other amortization expense

 

1,105

 

Adjusted Cash NOI

 

$

47,941

 

 

 

 

Annualized EBITDAre

 

$

162,676

 

Annualized Adjusted EBITDAre

 

$

175,116

 

Annualized Adjusted NOI

 

$

200,840

 

Annualized Adjusted Cash NOI

 

$

191,764

 

1.

 

These adjustments are made to reflect EBITDAre, NOI and Cash NOI as if all re-leasing activity, investments in and dispositions of real estate made during the three months ended March 31, 2021 had occurred on January 1, 2021.

2.

 

Adjustment excludes the $38 adjustment to our provision for loan loss and an $85 write-off of receivables from prior periods.

 

Essential Properties Realty Trust, Inc.

Reconciliation of Non-GAAP Financial Measures

 

(dollars in thousands, except share and per share amounts)

 

March 31, 2021

Secured debt:

 

 

Series 2017-1, Class A

 

$

156,522

 

Series 2017-1, Class B

 

15,669

 

Total secured debt

 

172,191

 

 

 

 

Unsecured debt:

 

 

$200mm term loan

 

200,000

 

$430mm term loan

 

430,000

 

Revolving credit facility1

 

138,000

 

Total unsecured debt

 

768,000

 

Gross debt

 

940,191

 

Less: cash & cash equivalents

 

(42,842

)

Less: restricted cash available for future investment

 

(1,974

)

Net debt

 

895,375

 

 

 

 

Equity:

 

 

Preferred stock

 

 

Common stock & OP units (109,725,486 shares @ $22.83/share as of 3/31/21)2

 

2,505,033

 

Total equity

 

2,505,033

 

Total enterprise value (“TEV”)

 

$

3,400,408

 

 

 

 

Pro forma adjustments to Net Debt and TEV:3

 

 

Net debt

 

$

895,375

 

Less: cash received — April 2021 follow-on offering

 

(185,500

)

Pro forma net debt

 

709,875

 

Total equity

 

2,505,033

 

Common stock — April 2021 follow-on offering (8,222,500 shares @ $22.83/share as of 3/31/21)

 

187,720

 

Pro forma TEV

 

$

3,402,628

 

 

 

 

Net Debt / TEV

 

 

26.3

%

Net Debt / Annualized Adjusted EBITDAre

 

5.1x

 

 

 

Pro Forma Net Debt / Pro Forma TEV

 

 

20.9

%

Pro Forma Net Debt / Annualized Adjusted EBITDAre

 

4.1x

1.

 

The Company’s revolving credit facility provides a maximum aggregate initial original principal amount of up to $400 million and includes an accordion feature to increase, subject to certain conditions, the maximum availability of the facility by up to $200 million.

2.

 

Common equity & units as of March 31, 2021, based on 109,171,639 common shares outstanding (including unvested restricted share awards) and 553,847 OP units held by non-controlling interests.

3.

 

Pro forma adjustments have been made to reflect the impact of the Company’s April 2021 follow-on offering of common stock. On April 15, 2021, the Company issued 8,222,500 shares of common stock for proceeds of $185.5 million, net of underwriters’ discounts.

 

Contacts

Investor/Media:

Essential Properties Realty Trust, Inc.

Daniel Donlan, Senior Vice President, Capital Markets

609-436-0619

info@essentialproperties.com