Essential Properties Realty Trust, Inc. · NYSE:EPRT
Essential Properties Realty Trust — Investor Presentation (March 2021)
26 slides from Essential Properties Realty Trust's investor presentation, Mar 8, 2021
Slide 1: March 2021 Presentation
ESSENTIAL =f= PROPERTIES March 2021 Presentation
Slide 2: Disclaimer
Investor Presentation – March 20211 Disclaimer This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements can be identified by the use of words such as “expect,”
Slide 3: Investment Highlights
Investor Presentation – March 20212 Investment Highlights Newly Assembled Portfolio of Single-Tenant Net Lease Properties with Long Duration Leases and Solid Unit-Level Rent Coverage Experienced Senior Management Team with Track Record of Growing and Managing Public Net Lease Companies to Significan
Slide 4: Stable Net Lease Portfolio
Investor Presentation – March 20213 Stable Net Lease Portfolio • High Occupancy: Our portfolio was 99.7% leased with three vacant properties at 4Q’20-end • Solid Coverage: Unit-level coverage of 2.9x with 98% of ABR required to report unit-level P&Ls • De-Minimis Near-Term Expirations: <1% and <5% o
Slide 5: Low Leverage and Ample Liquidity to Drive AFFO/sh Growth
Investor Presentation – March 20214 Source: Public filings, Factset, and SNL. Note: Financial data as of December 31, 2020. 1. Companies may calculate Adjusted Annualized EBITDAre differently; accordingly such data for EPRT and these companies may not be comparable. 2. 2021E AFFO per share growth is
Slide 6: Targeted Investment Strategy Based on Decades of Experience
Investor Presentation – March 20215 Service-Oriented & Experience-Based Industries Sale-Leaseback Transactions with Middle-Market Tenants Small-Scale Net Leased Properties E-commerce resistant Profit centers essential to tenant’s operations Customers must visit to receive service/experience
Slide 7: Seek to be the Capital Provider of Choice
Investor Presentation – March 20216 Seek to be the Capital Provider of Choice Maintain Direct Relationships with Our Tenants and Actively Seek to Leverage Our Relationships to Identify New Investment Opportunities Relationship-Based Sourcing 1. Percentage of portfolio cash ABR as of December 31, 202
Slide 8: New Vintage Portfolio is Focused on Targeted Industries
Investor Presentation – March 20217 New Vintage Portfolio is Focused on Targeted Industries Our Portfolio is the Result of a Disciplined Adherence to Investing in Properties Leased to Service-Oriented and Experience-Based Businesses with Unit-Level Reporting Investment Properties (#)1 1,181 Square F
Slide 9: Portfolio Summary
Investor Presentation – March 20218 Portfolio Summary Our Top 10 Tenants Operate 231 Properties and Represent 21.3% of Cash ABR Top 10 Tenants1,2 Properties % of Cash ABR 74 2.8% 23 2.6% 16 2.6% 13 2.3% 34 2.1% 5 1.9% 19 1.8% 13 1.7% 20 1.7% 14 1.7% Top 10 Tenants 231 21.3% Total 1,181 100.0% Top 10
Slide 10: Unit-Level Coverage and Tenant Financial Reporting
Investor Presentation – March 20219 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% C C C + B - B B + B B - B B B B + B B B - B B B B B B + A - A A + A A - % o f C a s h A B R < 1.00x 1.00 to 1.49x 1.50 to 1.99x ≥ 2.00x NR 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 2 0 2 1 2 0 2 2
Slide 11: Established and Proven Investment Infrastructure
Investor Presentation – March 202110 Established and Proven Investment Infrastructure Scalable Platform Allows for Consistent Sourcing of Investment Activity at Attractive Yields without Sacrificing Underwriting Standards and Investment Focus 1. Includes investments in mortgage loans receivable. 2.
Slide 12: Active Asset Management
Investor Presentation – March 202111 Active Asset Management Proactive Asset Management Mitigates Risk and Maximizes Risk-Adjusted Returns 1. Includes the impact of transaction costs. 2. Gains/(losses) based on our aggregate allocated purchase price. 3. Cash ABR at time of sale divided by gross sale
Slide 13: Leasing Summary
Investor Presentation – March 202112 Leasing Summary Lease Escalations Lease Escalation Frequency Lease Escalation Type Weighted Average Lease Escalation Frequency % of Cash ABR Annual Escalation Rate1,2 Annually 79.6% 1.5% Every 2 years 2.1 1.5 Every 3 years 0.8 0.0 Every 4 years 0.4 0.9 Every 5 ye
Slide 14: Debt Structure Allows for Capital Flexibility
Investor Presentation – March 202113 $2 $4 $4 $5 $160 $200 $430 $0 $100 $200 $300 $400 $500 2020 2021 2022 2023 2024 2025 2026 M a tu ri n g P ri n c ip a l B a la n c e ( $ m m ) Secured ABS Notes Five-Year Unsecured Term Loan Seven-Year Unsecured Term Loan Revolving Credit Facility Availability Ou
Slide 15: Differentiated Net Lease Portfolio
Investor Presentation – March 202114 4% 5% 6% 10% 14% 15% 19% 21% 27% 34% 86% 84% 38% 36% 35% 27% 22% 21% 19% 18% 100% 100% 95% 72% 65% 51% 44% 42% 42% 27% 3.1x 2.9x 2.7x 2.6x 2.6x 2.6x 2.4x NA NA NA 14.0 Weighted Average Lease Term (# of Years) 14.5 10.2 10.7 9.5 9.7 10.1 10.7 9.0 8.4 Differentiate
Slide 16: 2021E AFFO per Share Multiple and Growth vs Peers
Investor Presentation – March 202115 10.2% 6.9% 6.6% 6.3% 5.7% 4.8% 4.5% 4.0% 3.9% 2.5% 18.4x 18.4x 17.0x 16.9x 16.7x 14.9x 14.5x 13.8x 13.7x 11.7x 10.6% 10.0% 8.4% 6.9% 6.3% 5.8% 4.8% 3.7% 3.3% 2.1% 17.3x 16.7x 16.3x 16.0x 15.7x 14.6x 13.9x 13.2x 13.0x 11.3x 2021E AFFO per Share Multiple1 2021E AFF
Slide 17: Leverage Compared to Peers
Investor Presentation – March 202116 4.8x 4.8x 4.9x 5.2x 5.2x 5.3x 5.5x 5.6x 5.7x 6.1x 24% 25% 27% 27% 28% 30% 31% 33% 36% 41% 29.3% 31.3% 32.5% 32.8% 34.1% 35.0% 35.3% 35.4% 36.0% 37.8% 3.7x 2.6x 2.6x 2.5x 2.5x 2.0x 1.7x 1.6x 1.5x 1.0x Net Debt + Preferred / EBITDAre Net Debt + Preferred / Enterpri
Slide 18: Appendix
Appendix
Slide 19: Financial Summary – 4Q'20 Statements of Operations
Investor Presentation – March 202118 Financial Summary – 4Q’20 Consolidated Statements of Operations Three Months Ended December 31, Year Ended December 31, (in thousands, except share and per share data) 2020 2019 2020 2019 (Unaudited) (Unaudited) (Unaudited) (Audited) Revenues: Rental revenue1,2 $
Slide 20: Financial Summary – 4Q'20 FFO and AFFO
Investor Presentation – March 202119 Financial Summary – 4Q’20 Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) Three months ended December 31, Year ended December 31, (unaudited, in thousands except per share amounts) 2020 2019 2020 2019 Net income $ 5,705 $ 14,626 $ 42,528 $ 4
Slide 21: Financial Summary – 4Q'20 Consolidated Balance Sheets
Investor Presentation – March 202120 Financial Summary – 4Q’20 Consolidated Balance Sheets (in thousands, except share and per share amounts) December 31, 2020 December 31, 2019 ASSETS (Unaudited) (Audited) Investments: Real estate investments, at cost: Land and improvements $ 741,254 $ 588,279 Buil
Slide 22: Financial Summary – 4Q'20 GAAP Reconciliations
Investor Presentation – March 202121 Financial Summary – 4Q’20 GAAP Reconciliations to EBITDAre, GAAP NOI, Cash NOI and Estimated Run Rate Metrics Three Months Ended (unaudited, in thousands) December 31, 2020 Net income $ 5,705 Depreciation and amortization 19,004 Interest expense 7,764 Interest in
Slide 23: Market Capitalization, Debt Summary and Leverage Metrics
Investor Presentation – March 202122 Financial Summary – 4Q’20 Market Capitalization, Debt Summary and Leverage Metrics (dollars in thousands, except share and per share amounts) December 31, 2020 Rate1 Maturity2 Secured debt: Series 2017-1, Class A $ 157,524 4.10% 3.5 years Series 2017-1, Class B 1
Slide 24: Glossary Supplemental Reporting Measures
Investor Presentation – March 202123 Glossary Supplemental Reporting Measures FFO, Core FFO and AFFO Our reported results are presented in accordance with U.S. generally accepted accounting principles ("GAAP"). We also disclose funds from operations (“FFO”), core funds from operations (“Core FFO”) a
Slide 25: Glossary Supplemental Reporting Measures
Investor Presentation – March 202124 Glossary Supplemental Reporting Measures We also present our earnings before interest, taxes and depreciation and amortization for real estate (“EBITDA”), EBITDA further adjusted to exclude gains (or losses) on sales of depreciable property and real estate impair
Slide 26: Glossary: Adjusted EBITDAre / Adjusted NOI / Adjusted Cash NOI
Investor Presentation – March 202125 Glossary Supplemental Reporting Measures Adjusted EBITDAre / Adjusted NOI / Adjusted Cash NOI We further adjust EBITDAre, NOI and Cash NOI i) based on an estimate calculated as if all re-leasing, investment and disposition activity that took place during the quar
Essential Properties Realty Trust — Investor Presentation (March 2021) on 6ix