Global Net Lease, Inc. · NYSE:GNL
Global Net Lease — Q2 2022 Earnings Presentation
28 slides from Global Net Lease's earnings presentation, Aug 4, 2022
Slide 1: Global Net Lease Second Quarter 2022 Investor Presentation
Global Net Lease Second Quarter 2022 Investor Presentation Pictured – McLaren Campus in Woking, U.K.
Slide 2: Company Highlights
COMPANY HIGHLIGHTS Best - in - Class, Mission Critical, Net Lease Focused Portfolio : Featuring high portfolio occupancy of 98.9% and complete Original Cash Rent collection (1) for the seventh consecutive quarter, highlighting strong overall operating performance 1 Continued Leasing Momentum: In 202
Slide 3: Portfolio Highlights
PORTFOLIO HIGHLIGHTS Portfolio Overview Q 2 ’ 2 2 Q 2 ’ 2 1 Properties 311 311 Square Feet (millions) 3 9 .5 3 8 .2 Tenants 140 134 Industries 50 48 Countries and Territories 11 10 Leased 9 8 . 9 % 9 9 . 7 % Weighted Average Remaining Lease Term (1) 8.3 years 8.5 years % of SLR derived from Investme
Slide 4: Geographically Well-Balanced & High Investment Grade Tenancy
Auto Manufacturing 12% Financial Services 12% Consumer Goods 6% Healthcare 6% Technology 5% Freight 4% Government 4% All Other 23% Engineering 3% Metal Fabrication 3% Pharmaceuticals 3% Energy 3% Telecommunications 4% Logistics 4% Metal Processing 4% Investment Grade 62% Non - Investment Grade Rated
Slide 5: Attractive Portfolio in Line with Investment Grade Rated Peers
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 Remai
Slide 6: Best-in-Class Top Ten Tenant Base
BEST - IN - CLASS TOP TEN TENANT BASE *Represents Moody’s Implied Rating. ** Represents Tenant Parent Rating even if not a guarantor on the lease. 1. As of June 30, 2022. Metric based on SLR. Refer to SLR definition included in the footnotes on slide 3. Top Ten Tenants Tenant Rat ing Country Propert
Slide 7: Focus on Markets with Quality Sovereign Debt Ratings
Office Distribution Industrial Only Focused on Markets with Quality Sovereign Debt Ratings (S&P) U.S. Finland Luxembourg Germany The Nether lan ds Canada U.K. France Guernsey Spain Italy AA+ AA+ AAA AAA AAA AAA AA AA AA - A BBB Moo d y ’ s: A1 Moo d y ’ s: Aaa** Moody’s: Aa3 M oo d y ’ s: Aa3 M oo d
Slide 8: Comprehensive Hedging Program
COMPREHENSIVE HEDGING PROGRAM Hedging Foreign Currency Exchange Risk • GNL locks in fixed rates through forward contracts and converts foreign currencies into USD quarterly, stabilizing USD cash flows despite currency fluctuations • GNL’s utilization of financial instruments to protect against a wea
Slide 9: Differentiated Investment Process
DIFFERENTIATED INVESTMENT PROCESS Structuring & Pricing • Long term net leases with contractual rental increases (1) • Disciplined contract and lease negotiations, including tenant security deposits and key lease terms • Leverage extensive international relationships to generate risk - adjusted and
Slide 10: Acquisitions Summary
*Represents Moody’s Implied Rating. 1. Represents the contract purchase price and excludes acquisitions costs which are capitalized per GAAP. The acquisition costs for acquisitions completed during the six months ended June 30, 2022 were $0.6 million. 2. Weighted Average Cap Rate is a rate of return
Slide 11: Transaction Overview: Executive Mailing Services
Transaction Overview Tenant Executive Mailing Services (“EMS”) Property Type I ndu s t r ial Credit Rating Executive Mailing Service, Inc. (Moody’s Implied): Baa2 Location Palos Hills, IL Purchase Price $13.4 million Square Feet 175,000 Weighted Average Remaining Lease Term (1) (years) 15.0 Property
Slide 12: Leasing Momentum and Lease Expiration Schedule
In Q2’22, GNL continued the renewal leasing momentum it generated in Q1’22 and 2021 and completed an additional six lease renewals after Q1’22 quarter end. Total 2022 leasing activity of 2.7 million square feet and $102 million of net new straight - line rent over the new weighted average Remaining
Slide 13: Global Geographic Balance
GLOBAL GEOGRAPHIC BALANCE Note: Metrics as of June 30, 2022 unless otherwise noted. 1. Refer to basis for metric calculation included in the footnotes on slide 3. U.S. and Canada Number of Assets: 237 Weighted Average Remaining Lease Term: 8.7 years (1) % of GNL SLR: 62.0% (2) Europe Number of Asset
Slide 14: Continued Portfolio Focus on Diversified Industrial and Distribution Assets
Office 42% Industrial & Distribution 55% Retail 3% Office 43% Industrial & Distribution 52% Retail 5% United States & Canada 62% Euro p e 38% United States & Canada 60% Eu rope 40% CONTINUED PORTFOLIO FOCUS ON DIVERSIFIED INDUSTRIAL AND DISTRIBUTION ASSETS Continued Focus Towards Industrial and Dist
Slide 15: Q2'22 Performance Highlights
$41 .6 $45 .0 ( $5 . 8 ) Net Loss Common Stock Dividends AFFO Q2’22 Net Loss, AFFO (2) and Common Stock Dividends ($mm) Q2’22 PERFORMANCE HIGHLIGHTS 1. GNL is required to maintain unrestricted cash and cash equivalents (or amount available for future borrowings under credit facility) in an amount eq
Slide 16: Continued Focus on Driving Earnings Growth
$3,173 $3,4 2 1 $3,7 6 3 $4,319 $4,6 9 1 $4,5 2 4 $ 135 $ 149 $ 146 $ 1 3 5 $ 171 $200 20 17 20 18 20 19 202 0 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 $282 $306 $330 $3
Slide 17: Debt Metrics and Maturity
$43 $254 $325 $73 $666 $559 $500 $1 , 2 0 0 $1 , 0 0 0 $8 0 0 $6 0 0 $4 0 0 $2 0 0 $0 2 0 2 2 2 0 2 3 M ort g a g e s 2024 Credit Facility Thereafter 2025 2026 Unsecured Notes (7) 1% 4% 10% 7% 4% 4% 11% 11% 48% KEY METRICS Metric Q2’2022 Net Debt to Enterprise Value (1) 57.0% Net Debt to Adjusted EB
Slide 18: Management structure and corporate governance
Management structure fully aligned to compensate based on operational outperformance, in turn delivering increased value to shareholders No transactional fees allows for low general and administrative costs, which allows AR Global to provide greater resources at a lower cost (1) Company is supported
Slide 19: Forward-Looking Statements
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,” “antici
Slide 20: Risk Factors
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 prope
Slide 21: Risk Factors (Continued)
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 Ad
Slide 22: Disclaimers
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 presentation
Slide 23: Definitions
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 appro
Slide 24: Definitions (Continued)
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 related t
Slide 25: Definitions (Continued)
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 invol
Slide 26: Non-GAAP Reconciliations
NON – GAAP RECONCILIATIONS Three Months Ended June 30, 2022 June 30, 2021 EBITDA: Net (loss) income $ (716) 2,588 Depreciation and amortization 39,359 39,702 Interest expense 23,449 24,018 Income tax expense 2,515 1,930 EBITDA 64 , 607 68 , 238 Impairment charges 16,031 6,707 Equity based compensati
Slide 27: FFO and AFFO Reconciliations
FFO AND AFFO RECONCILIATIONS 1. 27 FFO, Core FFO and AFFO for the three months ended March 31, 2022, December 31, 2021 and September 30, 2021 include income from a lease termination fee of $0.3 million, $6.5 million and $2.2 million, respectively, which is recorded in revenue from tenants in the con
Slide 28: Annual FFO and AFFO Reconciliations
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) $ 20,73 1 $ 1,08 2 $ 34,53 5 $ ( 7,775 ) $ (