Phillips Edison & Company, Inc. · NASDAQ:PECO
Phillips Edison & — Phillips Edison Grocery Center REIT I — Q2 2017 Earnings Presentation
22 slides from Phillips Edison &'s earnings presentation, Aug 8, 2017
Slide 1: Second Quarter 2017 Results Presentation
Second Quarter 2017 Results Presentation Wednesday, August 9, 2017
Slide 2: Agenda
2 www.grocerycenterREIT1.com Agenda R. Mark Addy - President and COO • Portfolio Results • Financial Results • Shareholder Repurchase Program (SRP) • Acquisition of Phillips Edison Limited Partnership (PELP)
Slide 3: Forward-Looking Statement Disclosure
3 www.grocerycenterREIT1.com Forward-Looking Statement Disclosure This presentation and the corresponding call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include, but
Slide 4: Portfolio Highlights
4 www.grocerycenterREIT1.com Q2 2017 Portfolio Highlights • 158 total properties • 25 leading grocery anchors • 28 states • 17.2 million sq. ft. • 95.9% leased occupancy • 78.3% of rents from grocer, national and regional tenants
Slide 5: Portfolio Results
5 www.grocerycenterREIT1.com Q2 2017 Portfolio Results Grocer % of ABR # of Locations Kroger 8.8% 40 Publix Super Markets 7.5% 32 Ahold Delhaize 4.0% 10 Albertsons Companies 3.7% 13 Giant Eagle 2.6% 7 Top 5 Grocers by % of Annualized Base Rent Annualized Base Rent by Tenant Type Annualized Base Rent
Slide 6: Acquisition Highlights
6 www.grocerycenterREIT1.com Q2 2017 Acquisition Highlights Name Location Grocer GLA Rocky Ridge Town Center Roseville, CA Sprouts 93,337 Greentree Centre Racine, WI Pick N' Save 82,659 St. John's Plaza Titusville, FL Publix 117,507 Sierra Del Oro Shopping Center Corona, CA Ralph's 110,904 Rocky Rid
Slide 7: Financials - Three Month Results
7 www.grocerycenterREIT1.com Q2 2017 Financials - 3 Month Results Three Months Ended June 30, (in 000s) 2017 2016 $ Change % Change Net (Loss) Income Attributable to Stockholders $ (1,193 ) $ 560 $ (1,753 ) NM Adjustments(1) $ 27,793 $ 25,590 $ 2,203 8.6 % Funds from Operations (FFO) $ 26,600 $ 26,1
Slide 8: Financials - Six Month Results
8 www.grocerycenterREIT1.com Q2 2017 Financials - 6 Month Results Six Months Ended June 30, (in 000s) 2017 2016 $ Change % Change Net (Loss) Income Attributable to Stockholders $ (87 ) $ 2,779 $ (2,866 ) NM Adjustments(1) $ 54,997 $ 50,909 $ 4,088 8.0 % Funds from Operations (FFO) $ 54,910 $ 53,688
Slide 9: Same-Center NOI - Three Month Results
9 www.grocerycenterREIT1.com Q2 2017 Same-Center(1) Net Operating Income (NOI) - 3 Month Results Three Months Ended June 30, (in 000s) 2017 2016 $ Change % Change Revenues: Rental income(2) $ 42,304 $ 41,507 $ 797 Tenant recovery income 13,665 14,095 (430 ) Other property income 137 216 (79 ) 56,106
Slide 10: Same-Center NOI - Six Month Results
10 www.grocerycenterREIT1.com Q2 2017 Same-Center(1) Net Operating Income (NOI) - 6 Month Results Six Months Ended June 30, (in 000s) 2017 2016 $ Change % Change Revenues: Rental income(2) $ 84,967 $ 82,867 $ 2,100 Tenant recovery income 27,716 28,563 (847 ) Other property income 341 367 (26 ) 113,0
Slide 11: Debt Profile
11 www.grocerycenterREIT1.com Q2 2017 Debt Profile • Debt to Enterprise Value: 38.1%* • Weighted-Average Interest Rate: 3.1% • Weighted-Average Years to Maturity: 3.4 • Fixed-Rate Debt: 73.5%** • Variable-Rate Debt: 26.5% *Calculated as net debt (total debt, excluding below-market debt adjustments a
Slide 12: Share Repurchase Program
12 www.grocerycenterREIT1.com Share Repurchase Program Our Share Repurchase Program (SRP) states that the cash available for repurchases on any particular date will generally be limited to the proceeds from the DRIP during the preceding four fiscal quarters, less any cash already used for repurchase
Slide 13: Acquisition of PELP: Expected to Close During Q4
13 www.grocerycenterREIT1.com Acquisition of PELP: Expected to Close During Q4 • On May 18, 2017, Grocery Center REIT I (REIT I) announced they entered into a contribution agreement to acquire certain real estate assets and the third-party asset management businesses from its Sponsor, Phillips Ediso
Slide 14: Acquisition of PELP: Benefits of the Transaction
14 www.grocerycenterREIT1.com Acquisition of PELP: Benefits of the Transaction • The result of this transaction will be the largest internally managed REIT exclusively focused on grocery-anchored properties • Expected to be immediately accretive to FFO per share • Estimated pro forma dividend covera
Slide 15: Acquisition of PELP: Goal To Provide Liquidity for Shareholders
15 www.grocerycenterREIT1.com Acquisition of PELP: GOAL: To provide liquidity for Shareholders • Exclusive focus on grocery-anchored shopping centers: the most attractive space in shopping center real estate • Integrated veteran management team vested in the success of REIT I through a meaningful ow
Slide 16: For More Information: Thank You
For More Information: Thank You InvestorRelations@PhillipsEdison.com www.grocerycenterREIT1.com DST: (888) 518-8073 Griffin Capital Securities: (866) 788-8614
Slide 17: Appendix
Appendix
Slide 18: Same-Center NOI Definition
18 www.grocerycenterREIT1.com We present Same-Center Net Operating Income (“Same-Center NOI”) as a supplemental measure of our performance. We define Net Operating Income (“NOI”) as total operating revenues, adjusted to exclude lease buy-out income and non-cash revenue items, less property operating
Slide 19: Reconciliation of Net (Loss) Income to NOI and Same-Center NOI
19 www.grocerycenterREIT1.com Below is a reconciliation of net (loss) income to NOI and Same-Center NOI for the three and six months ended June 30, 2017 and 2016 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2017 2016(1) 2017 2016 Net (loss) income $ (1,221 ) $ 583 $ (87 ) $
Slide 20: Funds from Operations and Modified Funds from Operations
20 www.grocerycenterREIT1.com Funds from Operations and Modified Funds from Operations FFO is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We use FFO as defined by the National Association of Real Estate Investment Trusts (“NAREIT”) to be net inc
Slide 21: MFFO Adjustments Explanation
21 www.grocerycenterREIT1.com Many of the adjustments in arriving at MFFO are not applicable to us. Nevertheless, as explained below, management’s evaluation of our operating performance may also exclude items considered in the calculation of MFFO based on the following economic considerations. • Ad
Slide 22: FFO and MFFO Calculation
22 www.grocerycenterREIT1.com Three Months Ended June 30, Six Months Ended June 30, (in 000s, except per share amounts) 2017 2016 2017 2016 Calculation of FFO Net (loss) income attributable to stockholders $ (1,193 ) $ 560 $ (87 ) $ 2,779 Adjustments: Depreciation and amortization of real estate ass
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