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Essential Properties Announces First Quarter 2024 Results
First Quarter 2024 Financial and Operating Highlights:
Operating Results (compared to First Quarter 2023):
$ Invested $248.8 million
Investments (79 properties)
Weighted Avg Cash Cap Rate 8.1%
Net Proceeds $11.9 million
Dispositions (7 properties)
Weighted Avg Cash Cap Rate 6.5%
Decreased by 5% $0.28
Net Income per Share
Increased by 7% $0.46
Funds from Operations ("FFO") per Share
Increased by 9% $0.46
Core Funds from Operations ("Core FFO") per Share
Increased by 5% $0.42
Adjusted Funds from Operations ("AFFO") per Share
Debt, Equity & Leverage Update:
$24.75/share $256.2 million
Equity Raised (Gross) - Follow-On Offering (March 14, 2024) (1)
$24.17/share $53.4 million
Equity Raised (Gross) - ATM Program
_______________
1.
All shares were sold on a forward basis and 7,828,852 shares remain unsettled for estimated net proceeds of $184.2 million.
Activity Subsequent to First Quarter 2024:
$ Invested $61.0 million Investments (20 properties)
CEO Comments
Commenting on the first quarter 2024 results, the Company's President and Chief Executive Officer, Pete Mavoides, said, "The year has started off on a positive note, with our highest first quarter amount of investments since inception, reflecting favorable competitive dynamics and the benefits of our differentiated relationship-driven sale-leaseback platform. With a healthy portfolio and strong tenant credit trends, coupled with our conservative leverage position and strong liquidity, we are well-positioned to continue to invest accretively. Our favorable performance in the first quarter and a strong second quarter investment pipeline provide us with the support to increase the bottom end of our 2024 AFFO per share guidance range to $1.72 to $1.75."
Portfolio Highlights
The Company's investment portfolio as of March 31, 2024 is summarized as follows:
Number of properties 1,937 Weighted average lease term (WALT) 14.1 years Weighted average rent coverage ratio 3.9x Number of tenants 383 Number of concepts (i.e., brands) 548 Number of industries 16 Number of states 48 Weighted average occupancy 99.9% Total square feet of rentable space 19,254,998 Cash ABR - service-oriented or experience-based 93.2%
Portfolio Update
Investments
The Company's investment activity during the three months ended March 31, 2024 is summarized as follows:
Quarter Ended
March 31, 2024
--------------------
Investments:
$248.8 million
Investment volume
36
Number of transactions
79
Property count
8.1%/9.3%
Weighted average cash / GAAP cap rate
1.9%
Weighted average lease escalation
82%
% Subject to master lease
100%
% Sale-leaseback transactions
87%
% Existing relationship
100%
% Required financial reporting (tenant/guarantor)
Dispositions
The Company's disposition activity during the three months ended March 31, 2024 is summarized as follows:
Quarter Ended
March 31, 2024
--------------------
Dispositions:
$11.9 million
Net proceeds
7
Number of properties sold
$1.5 million
Net gain / (loss)
Loan Repayments
Loan repayments to the Company during the three months ended March 31, 2024 are summarized as follows:
Quarter Ended
March 31, 2024
--------------------
Loan Repayments:
$2.8 million
Proceeds--Principal
6
Number of properties
Leverage and Balance Sheet and Liquidity
The Company's leverage, balance sheet and liquidity as of March 31, 2024 are summarized in the following table.
March 31, 2024 Pro Forma (1)
March 31, 2024
-------------------- --------------------
Leverage:
4.1x 3.6x
Net debt to Annualized Adjusted EBITDAre
Balance Sheet and Liquidity:
$79.2 million $263.3 million
Cash and cash equivalents and restricted cash
$600.0 million $600.0 million
Unused revolving credit facility capacity
$184.2 million --
Forward equity sales - unsettled
$863.3 million $863.3 million
Total available liquidity
ATM Program:
$500.0 million
2022 ATM Program initial availability
$274.0 million
Aggregate gross sales under the 2022 ATM Program
$226.0 million
Availability remaining under the 2022 ATM Program
_______________
Guidance
2024 Guidance
The Company has increased the low end of its previously issued fully diluted 2024 AFFO per share estimate and now expects that 2024 AFFO per share on a fully diluted basis will be within a range of $1.72 to $1.75.
Note: The Company does not provide guidance for the most comparable GAAP financial measure, net income, or a reconciliation of the forward-looking non-GAAP financial measure of AFFO to net income computed in accordance with GAAP, because it is unable to reasonably predict, without unreasonable efforts, certain items that would be contained in the GAAP measure, including items that are not indicative of the Company's ongoing operations, such as, without limitation, potential impairments of real estate assets, net gain/loss on dispositions of real estate assets, changes in allowance for credit losses and stock-based compensation expense. These items are uncertain, depend on various factors, and could have a material impact on the Company's GAAP results for the guidance period.
Dividend Information
As previously announced, on March 7, 2024, Essential Properties' board of directors declared a cash dividend of $0.285 per share of common stock for the quarter ended March 31, 2024. The first quarter 2024 dividend represents an annualized dividend of $1.14 per share of common stock. The dividend was paid on April 12, 2024 to stockholders of record as of the close of business on March 29, 2024.
Conference Call Information
In conjunction with the release of Essential Properties' operating results, the Company will host a conference call on Thursday, April 25, 2024 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: 13745503. The telephone replay will be available through May 9, 2024.
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, 2024 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, 2024, the Company's portfolio consisted of 1,937 freestanding net lease properties with a weighted average lease term of 14.1 years and a weighted average rent coverage ratio of 3.9x. In addition, as of March 31, 2024, the Company's portfolio was 99.9% leased to 383 tenants operating 548 different concepts in 16 industries across 48 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. 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 year ended March 31, 2024 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 expenses 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 or loan prepayment 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.
Essential Properties Realty Trust, Inc.
Consolidated Statements of Operations
Three months ended March 31,
--------------------------------------------------------------------------------------------------------------------------
(in thousands, except share and per share data) 2024 2023
----------------------------------------------------------- -------------------- -------------------- ----------- -------------------- -------------------- -------------------- ----------- --------------------
(Unaudited) (Unaudited)
Revenues:
$ 98,510 $ 78,172
Rental revenue(1,2)
4,740 4,446
Interest on loans and direct financing lease receivables
251 1,069
Other revenue
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Total revenues 103,501 83,687
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Expenses:
9,358 8,583
General and administrative
993 843
Property expenses(2)
28,525 23,824
Depreciation and amortization
3,752 677
Provision for impairment of real estate
2 (30 )
Change in provision for credit losses
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Total expenses 42,630 33,897
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Other operating income:
1,512 4,914
Gain on dispositions of real estate, net
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Income from operations 62,383 54,704
Other (expense)/income:
(15,597 ) (12,133 )
Interest expense
493 638
Interest income
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Income before income tax expense 47,279 43,209
156 153
Income tax expense
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Net income 47,123 43,056
(148 ) (160 )
Net income attributable to non-controlling interests
-------------------- ----------- -------------------- -------------------- ----------- --------------------
Net income attributable to stockholders $ 46,975 $ 42,896
==================== =========== ==================== ==================== =========== ====================
Basic weighted-average shares outstanding 167,290,702 144,406,044
==================== =========== ==================== ==================== =========== ====================
Basic net income per share $ 0.28 $ 0.30
==================== =========== ==================== ==================== =========== ====================
Diluted weighted-average shares outstanding 168,854,601 146,000,007
==================== =========== ==================== ==================== =========== ====================
______________
1.
Includes contingent rent (based on a percentage of the tenant's gross sales at the leased property) of, $238 and $176 for the three months ended March 31, 2024 and 2023, respectively.
Essential Properties Realty Trust, Inc.
Consolidated Balance Sheets
(in thousands, expect share and per share amounts) March 31, 2024 December 31, 2023
--------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------ ------------------------------------------------------
(Unaudited) (Audited)
ASSETS
Investments:
Real estate investments, at cost:
$ 1,635,673 $ 1,542,302
Land and improvements
3,045,579 2,938,012
Building and improvements
17,892 17,890
Lease incentive
121,633 96,524
Construction in progress
88,320 89,209
Intangible lease assets
-------------------- -------------- -------------------- -------------------- -------------- --------------------
4,909,097 4,683,937
Total real estate investments, at cost
(393,784 ) (367,133 )
Less: accumulated depreciation and amortization
-------------------- -------------- -------------------- -------------------- -------------- --------------------
4,515,313 4,316,804
Total real estate investments, net
235,905 223,854
Loans and direct financing lease receivables, net
1,235 7,455
Real estate investments held for sale, net
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Net investments 4,752,453 4,548,113
Cash and cash equivalents 79,161 39,807
Restricted cash 3 9,156
Straight-line rent receivable, net 117,130 107,545
Derivative assets 37,207 30,980
Rent receivables, prepaid expenses and other assets, net 27,491 32,660
-------------------- -------------- -------------------- -------------------- -------------- --------------------
$ 5,013,445 $ 4,768,261
Total assets
==================== ============== ==================== ==================== ============== ====================
LIABILITIES AND EQUITY
Unsecured term loans, net of deferred financing costs $ 1,273,365 $ 1,272,772
Senior unsecured notes, net 395,985 395,846
Revolving credit facility -- --
Intangible lease liabilities, net 10,936 11,206
Intangible lease liabilities held for sale, net 76 --
Dividend payable 50,236 47,182
Derivative liabilities 9,490 23,005
Accrued liabilities and other payables 25,798 31,248
-------------------- -------------- -------------------- -------------------- -------------- --------------------
1,765,886 1,781,259
Total liabilities
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Commitments and contingencies -- --
Stockholders' equity:
-- --
Preferred stock, $0.01 par value; 150,000,000 authorized; none issued and outstanding as of March 31, 2024 and December 31, 2023
1,753 1,646
Common stock, $0.01 par value; 500,000,000 authorized; 175,306,386 and 164,635,150 issued and outstanding as of March 31, 2024 and December 31, 2023, respectively
3,325,668 3,078,459
Additional paid-in capital
(111,926 ) (105,545 )
Distributions in excess of cumulative earnings
23,594 4,019
Accumulated other comprehensive loss
-------------------- -------------- -------------------- -------------------- -------------- --------------------
3,239,089 2,978,579
Total stockholders' equity
8,470 8,423
Non-controlling interests
-------------------- -------------- -------------------- -------------------- -------------- --------------------
3,247,559 2,987,002
Total equity
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Essential Properties Realty Trust, Inc.
Reconciliation of Non-GAAP Financial Measures
Three months ended March 31,
------------------------------------------------------------------------------------------------------------------------
(unaudited, in thousands except per share amounts) 2024 2023
-------------------------------------------------- -------------------- -------------- -------------------- -------------------- ------ --------------------
Net income $ 47,123 $ 43,056
28,485 23,799
Depreciation and amortization of real estate
3,752 677
Provision for impairment of real estate
(1,512 ) (4,914 )
Gain on dispositions of real estate, net
-------------------- -------------- -------------------- -------------------- ------ --------------------
Funds from Operations 77,848 62,618
-- (876 )
Non-core expense (income)(1)
-------------------- -------------- -------------------- -------------------- ------ --------------------
Core Funds from Operations 77,848 61,742
Adjustments:
(9,980 ) (6,838 )
Straight-line rental revenue, net
949 819
Non-cash interest
2,945 2,721
Non-cash compensation expense
219 281
Other amortization expense
(7 ) (35 )
Other non-cash adjustments
(859 ) (432 )
Capitalized interest expense
-------------------- -------------- -------------------- -------------------- ------ --------------------
Adjusted Funds from Operations $ 71,115 $ 58,258
==================== ============== ==================== ==================== ====== ====================
Net income per share(2):
$ 0.28 $ 0.30
Basic
==================== ============== ==================== ==================== ====== ====================
$ 0.28 $ 0.29
Diluted
==================== ============== ==================== ==================== ====== ====================
FFO per share(2):
$ 0.46 $ 0.43
Basic
==================== ============== ==================== ==================== ====== ====================
$ 0.46 $ 0.43
Diluted
==================== ============== ==================== ==================== ====== ====================
Core FFO per share(2):
$ 0.46 $ 0.43
Basic
==================== ============== ==================== ==================== ====== ====================
$ 0.46 $ 0.42
Diluted
==================== ============== ==================== ==================== ====== ====================
AFFO per share(2):
$ 0.42 $ 0.40
Basic
==================== ============== ==================== ==================== ====== ====================
______________
1.
During the three months ended March 31, 2023, includes $0.9 million of insurance recovery income related to two properties.
Essential Properties Realty Trust, Inc.
Reconciliation of Non-GAAP Financial Measures
(in thousands) Three months ended March 31, 2024
------------------------------------------------------------------------------------- ---------------------------------------------------
Net income $ 47,123
28,525
Depreciation and amortization
15,597
Interest expense
(493 )
Interest income
156
Income tax expense
-------------------- ----------- --------------------
EBITDA 90,908
3,752
Provision for impairment of real estate
(1,512 )
Gain on dispositions of real estate, net
-------------------- ----------- --------------------
EBITDAre 93,148
4,122
Adjustment for current quarter re-leasing, acquisition and disposition activity(1)
392
Adjustment to exclude other non-core or non-recurring activity(2)
(183 )
Adjustment to exclude termination/prepayment fees and certain percentage rent(3)
-------------------- ----------- --------------------
Adjusted EBITDAre - Current Estimated Run Rate 97,479
8,784
General and administrative expense
-------------------- ----------- --------------------
Adjusted net operating income ("NOI") 106,263
(10,544 )
Straight-line rental revenue, net(1)
219
Other amortization expense
-------------------- ----------- --------------------
Adjusted Cash NOI $ 95,938
==================== =========== ====================
Annualized EBITDAre $ 372,592
Annualized Adjusted EBITDAre $ 389,916
Annualized Adjusted NOI $ 425,052
______________
1. Adjustment is made to reflect EBITDAre, NOI and Cash NOI as if all re-leasing activity, investments in and dispositions of real estate and loan repayments completed during the three months ended March 31, 2024 had occurred on January 1, 2024.
2. Adjustment is made to i) exclude non-core expenses added back to compute Core FFO, ii) exclude changes in the Company's provision for credit losses and iii) eliminate the impact of seasonal fluctuation in certain non-cash compensation expense recorded in the period.
Essential Properties Realty Trust, Inc.
Reconciliation of Non-GAAP Financial Measures
(dollars in thousands, except share and per share amounts) March 31, 2024 Rate Wtd. Avg. Maturity
------------------------------------------------------------------------------------------------------- ------------------------------------------------------ -------------------- --------------------
Unsecured debt:
$ 430,000 2.4% 2.9 years
February 2027 term loan(1)
400,000 4.6% 3.8 years
January 2028 term loan(1)
450,000 4.3% 4.9 years
February 2029 term loan(1,2)
400,000 3.1% 7.3 years
Senior unsecured notes due July 2031
-- --% 1.9 years
Revolving credit facility(3)
-------------------- -------------- --------------------
Total unsecured debt 1,680,000 3.6% 4.7 years
-------------------- -------------- --------------------
Gross debt 1,680,000
(79,161 )
Less: cash & cash equivalents
(3 )
Less: restricted cash available for future investment
-------------------- -------------- --------------------
Net debt 1,600,836
-------------------- -------------- --------------------
Equity:
--
Preferred stock
4,688,434
Common stock & OP units (175,860,233 shares @ $26.66/share as of 3/31/24)(4)
-------------------- -------------- --------------------
Total equity 4,688,434
-------------------- -------------- --------------------
Total enterprise value ("TEV") $ 6,289,270
==================== ============== ====================
Pro forma adjustments to Net debt and TEV:(5)
Net debt $ 1,600,836
(184,178 )
Less: Unsettled forward equity (7,828,852 shares @ $23.53/share as of 3/31/24)
-------------------- -------------- --------------------
Pro forma net debt 1,416,658
Total equity 4,688,434
208,717
Common stock -- unsettled forward equity (7,828,852 shares @ $26.66/share as of 3/31/24)
-------------------- -------------- --------------------
Pro forma TEV $ 6,313,809
==================== ============== ====================
Gross Debt / Undepreciated Gross Assets 31.1 %
Net Debt / TEV 25.5 %
Net Debt / Annualized Adjusted EBITDAre 4.1x
Pro Forma Gross Debt / Undepreciated Gross Assets 30.0 %
Pro Forma Net Debt