Realty Income Corporation · NYSE:O
Realty Income — Q2 2016 Earnings Presentation
26 slides from Realty Income's earnings presentation, Jul 27, 2016
Slide 1: Table of Contents
Corporate Overview 3 Financial Summary Consolidated Statements Of Income 4 Funds From Operations (FFO) 5 Adjusted Funds From Operations (AFFO) 6 Consolidated Balance Sheets 7 Debt Summary 8 Debt Maturities 9 Capitalization & Financial Ratios 10 EBITDA & Coverage Ratios 11 Debt Covenants 12 Transacti
Slide 2: Corporate Overview
Senior Management John P. Case, Chief Executive Officer Sumit Roy, President and Chief Operating Officer Paul M. Meurer, Executive VP, Chief Financial Officer and Treasurer Michael R. Pfeiffer, Executive VP, General Counsel and Secretary Neil M. Abraham, Executive VP, Chief Investment Officer Credit
Slide 3: Consolidated Statements Of Income
Consolidated Statements Of Income (dollars in thousands, except per share amounts) 4 Q2 2016 Supplemental Operating & Financial Data (unaudited) (unaudited) Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 REVENUE Rental $ 260,056 $ 241,431 $ 516,857 $ 476,554 Tenant reimbur
Slide 4: Funds From Operations (FFO)
Funds From Operations (FFO) (dollars in thousands, except per share amounts) 5 Q2 2016 Supplemental Operating & Financial Data The following is a reconciliation of net income available to common stockholders (which we believe is the most comparable GAAP measure) to FFO. Also presented is information
Slide 5: Adjusted Funds From Operations (AFFO)
Adjusted Funds From Operations (AFFO) (dollars in thousands, except per share amounts) 6 Q2 2016 Supplemental Operating & Financial Data The following is a reconciliation of net income available to common stockholders (which we believe is the most comparable GAAP measure) to FFO and AFFO. Also prese
Slide 6: Consolidated Balance Sheets
Consolidated Balance Sheets (dollars in thousands , except per share amounts) 7 Q2 2016 Supplemental Operating & Financial Data June 30, 2016 December 31, 2015 ASSETS (unaudited) Real estate, at cost: Land $ 3,436,504 $ 3,286,004 Buildings and improvements 9,403,441 9,010,778 Total real estate, at c
Slide 7: Debt Summary
Debt Summary (dollars in thousands) 8 Q2 2016 Supplemental Operating & Financial Data Principal Interest Weighted Balance as of Rate as of Average Years Maturity Date June 30, 2016 % of Debt June 30, 2016 until Maturity Credit Facility Credit Facility (1) June 30, 2019 $ 512,000 10.3% 1.35% 3.0 year
Slide 8: Debt Maturities
Debt Maturities (dollars in millions) 9 Q2 2016 Supplemental Operating & Financial Data Debt Maturities Year of Credit Term Senior Unsecured Mortgages Weighted Average Maturity Facility Loan Notes and Bonds Payable Total Interest Rate (1) 2016 $ - $ - $ 275.0 $ 4.8 $ 279.8 5.93% 2017 - - 175.0 149.7
Slide 9: Capitalization & Financial Ratios
Capital Structure as of June 30, 2016 Capitalization & Financial Ratios (dollars in thousands , except per share amounts) 10 Q2 2016 Supplemental Operating & Financial Data Liquidity as of June 30, 2016 Cash on Hand $ 20,443 Availability under Credit Facility 1,488,000 $ 1,508,443 Capitalization as
Slide 10: EBITDA & Coverage Ratios
Debt Service Coverage (2) Fixed Charge Coverage (3) EBITDA & Coverage Ratios (dollars in thousands) 11 Q2 2016 Supplemental Operating & Financial Data Reconciliation of Net Income to EBITDA (1) Three months ended June 30, 2016 Net income $ 76,068 Interest 57,409 Income taxes 953 Depreciation and amo
Slide 11: Debt Covenants
Debt Covenants 12 Q2 2016 Supplemental Operating & Financial Data As of June 30, 2016 The following is a summary of the key financial covenants for our senior unsecured notes and bonds, as defined and calculated per their terms. These calculations, which are not based on U.S. GAAP measurements, are
Slide 12: Investment Summary
First Quarter 2016 Number of Properties Investment Cash Rents Leasable Square Feet Cash Capitalization Rate (1) Weighted Average Lease Term (Years) New Property Acquisitions (2) 80 $ 300,523 $ 19,708 877,997 6.6% 16.3 Properties under Development (3) 23 52,118 3,547 853,273 6.8% 13.1 Total Real Esta
Slide 13: Disposition Summary
First Quarter 2016 Number of Properties Original Investment Net Book Value Net Proceeds Cash Capitalization Rate (1) Occupied 2 $ 3,455 $ 2,535 $ 3,377 6.9% Vacant 9 12,511 6,148 7,661 - Total Real Estate Dispositions 11 $ 15,966 $ 8,683 $ 11,038 The unlevered internal rate of return on properties s
Slide 14: Top Tenants
Top 20 Tenants Our 20 largest tenants based on percentage of total portfolio annualized rental revenue at June 30, 2016 include the following: Investment Grade Tenants (2) : Number of Properties 1,737 Percentage of Annualized Rents 44% Percentage of Leases with Rental Increases, Based on Revenue 73%
Slide 15: Industry Diversification
* Less than 0.1% Industry Diversification 17 Q2 2016 Supplemental Operating & Financial Data (1) Includes rental revenue for all properties owned at the end of each period presented, including revenue from properties reclassified as discontinued operations. Percentage of Rental Revenue (1) For the Q
Slide 16: Industry Diversification (Cont'd)
Industry Diversification (Cont’d) 18 Q2 2016 Supplemental Operating & Financial Data * Less than 0.1% (1) Includes rental revenue for all properties owned at the end of each period presented, including revenue from properties reclassified as discontinued operations. Percentage of Rental Revenue (1)
Slide 17: Geographic Diversification
* Less than 0.1% (1) Includes rental revenue for all properties owned at June 30, 2016. Excludes rental revenue of $253 from sold properties. Geographic Diversification (dollars in thousands) 19 Q2 2016 Supplemental Operating & Financial Data Approximate Rental Revenue for Percentage of Number of Pe
Slide 18: Property Type Composition
Property Type Composition (dollars in thousands) 20 Q2 2016 Supplemental Operating & Financial Data (1) Includes rental revenue for all properties owned at June 30, 2016. Excludes rental revenue of $253 from sold properties. (2) Refer to footnote 2 on page 16 for our definition of investment grade t
Slide 19: Second Quarter 2016 Same Store Rental Revenue
Top 3 Industries Contributing to the Change Quarter ended Quarter ended Net % Change Industry June 30, 2016 June 30, 2015 Change by Industry Motor Vehicle Dealerships $ 4,522 $ 3,893 $ 629 16.2 % Convenience Stores 22,784 22,195 589 2.7 % Theaters 12,299 11,871 428 3.6 % Second Quarter 2016 Same Sto
Slide 20: Same Store Rental Revenue (Cont'd)
Same Store Rental Revenue (Cont’d)(dollars in thousands) 22 Q2 2016 Supplemental Operating & Financial Data Same Store Rental Revenue by Property Type Second Quarter 2016 Quarter ended Quarter ended Net % Change by Contribution by Property Type June 30, 2016 June 30, 2015 Change Property Type Proper
Slide 21: Occupancy
By Property Occupied Properties 4,551 Total Properties 4,646 Occupancy 98.0% By Square Footage Occupied Square Footage 78,147,510 Total Square Footage 79,041,790 Occupancy 98.9% By Rental Revenue (Economic Occupancy) Quarterly Rental Revenue $ 255,078,557 Quarterly Vacant Rental Revenue $ 2,727,343
Slide 22: Leasing Activity
Allocation Based on Number of Leases Leasing Activity (dollars in thousands) 24 Q2 2016 Supplemental Operating & Financial Data Re-leased to New Tenant (1) Q1 2016 Re-leased to Without After a Period Re-leasing Totals Same Tenant Vacancy of Vacancy Prior Cash Rents $ 4,256 $ 902 $ 263 $ 5,421 New Ca
Slide 23: Expirations
25 * Less than 0.1% (1) This table sets forth the timing of remaining lease term expirations on our 4,530 net leased, single-tenant properties as of June 30, 2016 and their contribution to rental revenue for the quarter ended June 30, 2016. Excludes 22 multi-tenant properties and 95 vacant propertie
Slide 24: Earnings Guidance
26 We estimate FFO per share for 2016 of $2.82 to $2.89. We estimate AFFO per share for 2016 of $2.85 to $2.90, an increase of 4.0% to 5.8% over 2015 AFFO per share of $2.74. Summarized below are approximate estimates of the key components of the company’s 2016 earnings guidance: Earnings Guidance Q
Slide 25: Analyst Coverage
27 Q2 2016 Supplemental Operating & Financial Data Realty Income Corporation is covered by the analysts at the firms listed above. This list may not be complete and is subject to change. Please note that any opinions, estimates or forecasts regarding Realty Income Corporation's performance made by t
Slide 26: Analyst Coverage
Analyst Coverage REALTY INCOME The Monty Dividend Company" ‘su igan ‘inigan@baitcom (913)273.0252 Wiar Haman ‘shamangbaiscon (419)2982357 Dhan Saati com (645855 1589 Came an m (645336 2098, sts ‘Srinophecas@apiaonecom 763.8151 Viet fran ‘wnstdtanna@caploncon (679357013 co Michal Berman rr com eorrat