Global Net Lease, Inc. · NYSE:GNL
Global Net Lease — Q4 2021 Earnings Presentation
31 slides from Global Net Lease's earnings presentation, Feb 24, 2022
Slide 1: Global Net Lease Fourth Quarter 2021 Investor Presentation
Global Net Lease Fourth Quarter 2021 Investor Presentation Pictured – McLaren Campus in Woking , U.K.
Slide 2: Company Highlights
COMPANY HIGHLIGHTS High - Quality, Mission Critical, Net Lease Focused Portfolio : Featuring high portfolio occupancy of 99.0% and complete Original Cash Rent collection (1) for the fifth consecutive quarter, highlighting strong overall operating performance 1 Strong Leasing Activity: In 2021, GNL c
Slide 3: Portfolio Highlights
3 PORTFOLIO HIGHLIGHTS Portfolio Overview Q4’21 Q4’20 Properties 309 306 Square Feet (millions) 39.3 37.2 Tenants 138 130 Industries 51 48 Countries and Territories 11 10 Leased 99.0% 99.7% Weighted Average Remaining Lease Term (1) 8.3 years 8.5 years % of SLR derived from Investment Grade Tenants (
Slide 4: Geographically Well-Balanced & High Investment Grade Tenancy Supports Continued Growth
4 Financial Services 13% Auto Manufacturing 12% Consumer Goods 6% Healthcare 5% Technology 5% Freight 4% Aerospace 4% Logistics 4% Telecommunications 4% Engineering 3% Energy 3% Pharmaceuticals 3% Metal Fabrication 3% All Other 23% Investment Grade 63% Non - Investment Grade Rated 34% Not Rated 3% M
Slide 5: Attractive Portfolio in Line with Investment Grade Rated Peers
5 ATTRACTIVE PORTFOLIO IN LINE WITH INVESTMENT GRADE RATED PEERS GNL’s diversified portfolio of assets that are primarily leased to Investment Grade rated tenants and located in select North American and European countries compares favorably to GNL’s investment grade rated peers Weighted Average Rem
Slide 6: 2021 Lease Extensions and Expansions
6 In 2021, GNL completed ten lease extensions and one tenant expansion project, totaling 1.5 million square feet and added approximately $96 million of net straight - line rent over the new weighted average Remaining Lease Term 2021 Lease Extensions + Expansions Strategic Lease Extensions With Key T
Slide 7: Reaching and Exceeding Pre-Pandemic Performance Levels
7 Significant Upside Potential $60.1 $80.5 Q4'19 Q1'21 REACHING AND EXCEEDING PRE - PANDEMIC PERFORMANCE LEVELS 1. Cash Rent collected includes both contractual rents and deferred rents paid during the period. 2. For Q4’21 Net Loss per Share was ($0.08) and for Q1’20, Net Income per Share was $0.05.
Slide 8: Best-in-Class Top Ten Tenant Base
8 Tenant Rating Country Property Type % of SLR (1) Caa1 (Moody’s) / B - (Fitch) U.K. Industrial 6% Baa2** U.S. / Canada Distribution 4% Baa1 U.S. / Italy Industrial / Distribution 4% Aaa** U.S. Office 3% Baa2* U.K. Office 3% Baa3** U.S. Industrial / Distribution 3% Aa3 NETH Office 3% Baa1 U.S. Indus
Slide 9: Focus on World-Class Tenants
9 Office Distribution Industrial Only Focused on Markets with Quality Sovereign Debt Ratings (S&P) U.S. Finland Luxembourg Germany The Netherlands Canada U.K. France Guernsey Spain Italy AA+ AA+ AAA AAA AAA AAA AA AA AA - A BBB Moody’s: A1 Moody’s: Aaa** Moody’s: Aa3 Moody’s: Aa3 Moody’s: Baa2 Moody
Slide 10: Differentiated Investment Strategy
10 DIFFERENTIATED INVESTMENT STRATEGY Geography Asset Type Property Fundamentals Credit Quality Structure and Pricing • Focus on U.S. and strong sovereign debt rated countries in Continental Europe • Strategically located industrial and distribution facilities • Mission critical, single tenant net l
Slide 11: 2021 Acquisitions
11 *Represents Moody’s Implied Rating’ ** Represents Tenant or Guarantor Parent Rating even if not a guarantor on the lease. 1. Going - in Cap Rate is a rate of return on a real estate investment property based on the expected, cash rental income that the pr operty will generate under its existing l
Slide 12: Walmart Acquisition Transaction Overview
12 Transaction Overview Tenant Walmart, Inc. Property Type Office (Class A) Credit Rating Walmart, Inc. (S&P/Moody’s): AA/Aa2 Location Bentonville, AR Purchase Price $40.6 million Square Feet 90,334 Weighted Average Remaining Lease Term (1) (years) 7.0 Tenant • Headquartered in Bentonville, AR, Walm
Slide 13: Global Geographic Balance
13 GLOBAL GEOGRAPHIC BALANCE Note: Metrics as of December 31, 2021 unless otherwise noted. 1. Refer to basis for metric calculation included in the footnotes on page 3. 2. Metric based on SLR. Refer to SLR definition included in the footnotes on page 3. U.S. and Canada Number of Assets: 235 Weighted
Slide 14: Continued Focus Towards Industrial and Distribution Properties
14 Office 46% Industrial/Distribution 49% Retail 5% United States & Canada 60% Europe 40% Office 42% Industrial/Distribution 54% Retail 4% Continued Focus Towards Industrial and Distribution Properties and Balanced Geographic Diversification United States & Canada 64% Europe 36% Property Type Concen
Slide 15: Fourth Quarter 2021 Key Highlights
15 $41.6 $46.0 Net Loss Common Stock Dividends AFFO ($7.8) Net Loss Common Stock Dividends AFFO Q4’21 Net Loss, AFFO (4) and Common Stock Dividends ($mm) Fourth Quarter 2021 Key Highlights • Closed on ten acquisitions in 2021 for $497.2 million at a weighted average Going - in Cap Rate (1) of 7.8% a
Slide 16: Q4 2021 Acquisitions
16 Acquisition ($000s) Property Type Closing Date Purchase Price Number of Properties Annualized Straight - Line Rent (1) Acquisitions (2) Promess 3 - Pack Industrial 12/10/2021 $12,059 3 $942 Thetford Corporation 4 - Pack Industrial 12/13/2021 & 12/23/2021 $51,280 4 $3,472 PFB Corporation 8 - Pack
Slide 17: Continued Focus on Driving Earnings Growth
17 $135 $149 $146 $135 $171 2017 2018 2019 2020 2021 $3,173 $3,421 $3,763 $4,319 $4,691 1/1/2017 1/1/2018 1/1/2019 1/1/2020 1/1/2021 CONTINUED FOCUS ON DRIVING EARNINGS GROWTH Historical Revenue Growth Core Funds From Operations (1) Real Estate Assets at Cost Adjusted Funds From Operations (1) $259
Slide 18: Debt Metrics and Maturity
18 $67 $281 $357 $79 $0 $665 $226 $280 $ 500 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2022 2023 2024 2025 2026 Thereafter Mortgages Credit Facility Unsecured Notes 3% 5% 11% 8% 5% 2% 10% 10% 46% KEY METRICS Metric Q4’2021 Net Debt to Enterprise Value (1) 55.6% Net Debt to Adjusted EBITDA (Q4’21 a
Slide 19: Management Structure Fully Aligned
19 Management structure fully aligned to compensate based on operational outperformance, in turn delivering increased value to shareholders James L. Nelson Chief Executive Officer and President No transactional fees allows for low general and administrative costs, which allows AR Global to provide g
Slide 20: Comprehensive Hedging Program
20 COMPREHENSIVE HEDGING PROGRAM Hedging Foreign Currency Exchange Risk • Provides protection against a weakening in the value of EUR and GBP versus the U.S. Dollar associated with the Company’s foreign property operations Interest Rate Swaps: Fixing Interest on Floating Rate Debt • Cost effective t
Slide 21: Forward-Looking Statements
21 The statements in this presentation that are not historical facts may be forward - looking statements . These forward - looking statements involve risks and uncertainties that could cause actual results or events to be materially different . In addition, words such as “may,” “will,” “seeks,” “ant
Slide 22: Risk Factors
22 RISK FACTORS The following are some of the risks and uncertainties, although not all risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward - looking statements . • We may be unable to acquire properties on advantageous terms or our p
Slide 23: Risk Factors (Continued)
23 RISK FACTORS (CONTINUED) • In owning properties we may experience, among other things, unforeseen costs associated with complying with laws and regulations and other costs, potential difficulties selling properties and potential damages or losses resulting from climate change . • We depend on our
Slide 24: Disclaimers
24 DISCLAIMERS • This presentation includes estimated projections of future operating results . These projections were not prepared in accordance with published guidelines of the SEC or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentat
Slide 25: Definitions
25 DEFINITIONS • Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts ("NAREIT"), an industry trade group, has promulgated a measure known as funds from operations ("FFO"), which we believe to be an ap
Slide 26: Definitions (Continued)
26 DEFINITIONS (CONTINUED) • In calculating Core FFO, we start with FFO, then we exclude certain non - core items such as acquisition, transaction and other costs, as well as certain other costs that are considered to be non - core, such as debt extinguishment costs, fire loss and other costs relate
Slide 27: Definitions (Continued)
27 DEFINITIONS (CONTINUED) • As a result, we believe that the use of FFO, Core FFO and AFFO, together with the required GAAP presentations, provide a more complete understanding of our performance including relative to our peers and a more informed and appropriate basis on which to make decisions in
Slide 28: Non-GAAP Reconciliations
28 NON – GAAP RECONCILIATIONS Three Months Ended December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020 March 31, 2020 EBITDA: Net (loss) income $ (2,796) $ 7,390 $ 2,588 $ 4,184 $ (8,495) $ 9,601 Depreciation and amortization 42,025 41,665 39,702 39,684 35,977 33,533 In
Slide 29: FFO and AFFO Reconciliations
29 FFO AND AFFO RECONCILIATIONS Three Months Ended December 31, 2021 December 31, 2020 March 31, 2020 December 31, 2019 Funds from operations (FFO): Net (loss) income attributable to common stockholders (in accordance with GAAP) $ (7,812) $ (13,277) $ 5,038 $ 9,263 Impairment charges 9,619 — — — Dep
Slide 30: Annual FFO and AFFO Reconciliations
30 ANNUAL FFO AND AFFO RECONCILIATIONS Twelve Months Ended December 31, 2017 December 31, 2018 December 31, 2019 December 31, 2020 December 31, 2021 Funds from operations (FFO): Net income (loss) attributable to common stockholders (in accordance with GAAP) $ 20,731 $ 1,082 $ 34,535 $ (7,775) $ (8,6
Slide 31: Contributed to Expected NOI – Q4'21 Acquisition Reconciliation
31 CONTRIBUTED TO EXPECTED NOI – Q4’21 ACQUISITION RECONCILIATION Total GNL Excluding Q4’21 Acquisitions (1) Impact of Q4’21 Acquisitions (2) Total GNL (3) Quarterly Expected NOI From Q4’21 Acquisitions EBITDA: Net (loss) income $ (2,952) $ 156 $ (2,796) $ 988 Depreciation and amortization 41,915 11