Global Net Lease, Inc. · NYSE:GNL
Global Net Lease — Q3 2019 Earnings Presentation
26 slides from Global Net Lease's earnings presentation, Nov 8, 2019
Slide 1: Global Net Lease Third Quarter 2019 Investor Presentation
Global Net Lease Third Quarter 2019 Investor Presentation
Slide 2: Overview: Differentiated Strategy with International Exposure
2 OVERVIEW Differentiated Strategy with International Exposure 1. As used herein, investment grade includes both actual investment grade ratings of the tenant or guarantor, if available, or i mpl ied investment grade. Implied investment grade may include actual ratings of tenant parent, guarantor pa
Slide 3: Portfolio Highlights
3 PORTFOLIO HIGHLIGHTS Properties 264 Square Feet (millions) 28.9 Tenants 120 Industries 45 Countries 7 Leased 99.6% Weighted - Average Remaining Lease Term (1) 8.0 years % of SLR derived from Investment Grade Tenants (2)(3) 70.7% % of leases with contractual rent increases (4) 92.5% Portfolio Overv
Slide 4: Well Balanced Portfolio
4 Non Investment Grade 27.1% Investment Grade 70.7% Not Rated 2.2% WELL BALANCED PORTFOLIO As of September 30, 2019 . 1. Metric based on SLR. Refer to SLR definition included in the footnotes on page 3. 2. Refer to Investment Grade Rating definition included in the footnotes on page 2. Credit Rating
Slide 5: Well Diversified Tenant Base: Top Ten Tenants
5 Tenant Rating Country Property Type % of SLR (1) Baa2** U.S. Distribution 5% Aaa** U.S. Office 4% Baa2 GER Office 4% Baa2* U.K. Office 4% Aa3 NETH Office 3% Aa1** FIN Industrial 3% Baa2 U.S. Distribution 3% Ba1* U.S. Industrial 3% Aa3 U.S. Office 2% A3 U.K. Distribution 2% WELL DIVERSIFIED TENANT
Slide 6: Focus on High-Quality Tenants
6 Office Distribution Industrial FOCUS ON HIGH - QUALITY TENANTS Only Focused on Markets with Quality Sovereign Debt Ratings (S&P) U.S. Luxembourg Germany The Netherlands Finland U.K. France AA+ AAA AAA AAA AA+ AA AA Best - in - class portfolio leased to largely Investment Grade Rated Tenants (1) in
Slide 7: Differentiated Investment Strategy
7 DIFFERENTIATED INVESTMENT STRATEGY Geography Asset Type Property Fundamentals Credit Quality Structure and Pricing Focused on single - tenant commercial properties to generate superior risk - adjusted returns • Focus on the U.S. and strong sovereign debt rated countries in Continental Europe • Mis
Slide 8: Acquisitions and Pipeline
8 *Represents Moody’s Implied Rating. ** Represents Tenant or Guarantor Parent Rating even if not a guarantor on the lease. *** 54% of the Plasma 9 - Pack portfolio is implied investment grade and is weighted based on SLR. 1. As of November 4, 2019, the Company has signed four definitive purchase an
Slide 9: Geographic Balance (as of September 30, 2019)
9 GEOGRAPHIC BALANCE (AS OF SEPTEMBER 30, 2019) 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. Number of Assets: 196 Weighted - Average Remaining Lease Term: 8.3 years (1) % of GN
Slide 10: Portfolio Comparison: Q3 2019 vs Q3 2018
10 Office 52% Industrial/Distribution 43% Retail 5% PORTFOLIO COMPARISON: Q3 2019 VS Q3 2018 Continued Focus towards United States Industrial and Distribution Properties Office 55% Industrial/Distribution 36% Retail 9% United States 53% Europe 47% Property Type Concentration (1) Geographic Concentra
Slide 11: Third Quarter Acquisition: SWECO, Inc.
11 Transaction Overview THIRD QUARTER ACQUISITION: SWECO, INC. Property and Tenant Overview Tenant SWECO, Inc. Property Type Industrial/Office HQ Credit Rating (1) S&P: Guarantor’s Parent: AA - Moody’s: Guarantor’s Parent: A1 Location Florence, KY Square Feet 191,215 Lease Term (years) 10.8 Tenant •
Slide 12: Acquisition: Encompass Health Corporation
12 1. Tenant’s actual credit rating. Refer to Investment Grade Rating definition included in the footnotes on page 2 and page 3. Transaction Overview Tenant Encompass Health Corporation Property Type Office Credit Rating (1) S&P: BB - Moody’s: Ba3 Location Birmingham, AL Square Feet 199,305 Lease Te
Slide 13: Fully Aligned Management Structure
13 Chris Masterson Chief Financial Officer, Treasurer and Secretary FULLY ALIGNED MANAGEMENT STRUCTURE Fully integrated external management team creates highly scalable platform with an acquisition pipeline generated by a proven, country - focused origination network No transactional fees allows for
Slide 14: GNL Capital Structure
14 GNL CAPITAL STRUCTURE GNL continued to improve its capital structure during the third quarter of 2019 by extending debt maturities and optimizing the debt structure for continued future growth Debt Maturity and Interest Expense by Quarter (1) GNL Capital Structure by Quarter (1) (in millions) (ye
Slide 15: Performance Metrics
15 PERFORMANCE METRICS 1. See page 8 for further details. 2. For the third quarter 2019, represents net debt equal to $1.6 billion (total debt outstanding of $1.9 billion less cash and c ash equivalents of $305 million) to Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“EBI
Slide 16: Debt Overview
16 $123 $16 $11 $331 $902 $101 $393 $- $200 $400 $600 $800 $1,000 $1,200 $1,400 2019 2020 2021 2022 2023 Thereafter Mortgages Line of Credit 0% 0.4% 1.7% 8.2% 9.8% 22.7% 12.6% 7.2% 2.4% 35.0% DEBT OVERVIEW Net Debt to Enterprise Value (1) 45.0% Net Debt to Adjusted EBITDA (annualized) (2) 6.7x Inter
Slide 17: Comprehensive Hedging Program
17 COMPREHENSIVE HEDGING PROGRAM Hedging Foreign Currency Exchange Risk (“Cash Flow Hedging Instruments”) • Provides protection against unfavorable movements in EUR and GBP versus the U.S. Dollar (“USD”) associated with the Company’s foreign property operations Interest Rate Swaps: Fixing Interest o
Slide 18: Forward-looking statements
18 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 19: Risk Factors
19 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 . • All of our executive officers are also officers, managers, employees
Slide 20: Projections
21 PROJECTIONS • 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 21: Definitions
22 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 22: Definitions (continued)
23 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 23: Definitions (continued)
24 DEFINITIONS (CONTINUED) • Excluding income and expense items detailed above from our calculation of AFFO provides information consistent with management's analysis of the operating performance of the Company . Additionally, fair value adjustments, which are based on the impact of current market f
Slide 24: Non-GAAP Reconciliations
25 NON – GAAP RECONCILIATIONS Three Months Ended September 30, 2019 June 30, 2019 March 31, 2019 December 31, 2018 September 30, 2018 EBITDA: Net income (loss) $ 9,941 $ 15,328 $ 8,276 $ (4,290) $ 2,632 Depreciation and amortization 31,620 31,084 31,303 30,078 30,195 Interest expense 16,154 15,689 1
Slide 25: FFO and AFFO Reconciliations
26 FFO AND AFFO RECONCILIATIONS Three Months Ended September 30, 2019 June 30, 2019 March 31, 2019 December 31, 2018 September 30, 2018 Funds from operations (FFO): Net income (loss) attributable to common stockholders (in accordance with GAAP) $ 6,860 $ 12,621 $ 5,791 $ (6,744) $ 177 Impairment cha
Slide 26: Investor Inquiries
INVESTOR INQUIRIES 1 - 866 - 902 - 0063 investorrelations@globalnetlease.com www.GlobalNetLease.com