Essential Properties Realty Trust, Inc. · NYSE:EPRT
Essential Properties Realty Trust — Investor Presentation (January 2021)
26 slides from Essential Properties Realty Trust's investor presentation, Jan 12, 2021
Slide 1: Investor Presentation – January 2021
Investor Presentation – January 2021
Slide 2: Disclaimer
Investor Presentation – January 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 – January 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 Signific
Slide 4: Portfolio and Collections Stabilizing
Investor Presentation – January 20213 Portfolio and Collections Stabilizing • 4Q’20 Collection at ~91% of ABR: We expect to collect approximately 91% of 4Q’20 ABR with another 3% subject to recognized deferral agreements Strong Balance Sheet with Ample Liquidity • Low Leverage: Net Debt + Preferred
Slide 5: COVID-19 Impact on Portfolio
Investor Presentation – January 20214 COVID-19 Impact on Portfolio Portfolio Rent Collection and Deferral Information Note: Ratios are based on percentage of Cash ABR as of December 31, 2020, with two exceptions. The 2Q’20 ABR for Town Sports and Love’s Furniture was used in the denominator. 1. Incl
Slide 6: Low Leverage and Ample Liquidity to Drive Robust AFFO/sh Growth
Investor Presentation – January 20215 18.0% 9.9% 8.8% 8.2% 7.0% 6.0% 5.7% 3.3% 3.2% 1.8% 4.0x 4.7x 4.9x 5.0x 5.2x 5.3x 5.4x 5.8x 6.0x 6.2x Source: Public filings, Factset, and SNL. Note: Financial data as of September 30, 2020. 1. Companies may calculate Adjusted Annualized EBITDAre differently; acc
Slide 7: Service-Oriented & Experience-Based Industries
Investor Presentation – January 20216 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 8: Seek to be the Capital Provider of Choice
Investor Presentation – January 20217 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 September 30,
Slide 9: New Vintage Portfolio is Focused on Targeted Industries
Investor Presentation – January 20218 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 1,096 Square
Slide 10: Top Tenant Concentration
Investor Presentation – January 20219 Top 10 Tenant Concentration Our Top 10 Tenants Operate 236 Properties and Represent 22.6% of Cash ABR Top 10 Tenant Exposure Top 10 Tenants1,2 Properties % of Cash ABR 74 3.0% 23 2.8% 13 2.6% 14 2.4% 34 2.2% 5 2.1% 13 1.9% 20 1.9% 14 1.9% 26 1.8% Top 10 Tenants
Slide 11: Disciplined Underwriting Leading to Healthy Portfolio Metrics
Investor Presentation – January 202110 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 0 2 0
Slide 12: Established and Proven Investment Infrastructure
Investor Presentation – January 202111 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. Cash ABR for the first full month after the investme
Slide 13: Active Asset Management
Investor Presentation – January 202112 • 4Q’20 Update: Sold ~$40mm of properties in the quarter • Dispositions Have Traded at Attractive Cap Rates: Since inception in 2016 through 3Q’20, we have sold 172 properties for $240mm in net proceeds and achieved a weighted average cash cap rate of 6.7% on t
Slide 14: Differentiated Net Lease Investment Opportunity
Investor Presentation – January 202113 3.5x 3.0x 2.8x 2.7x 2.7x 2.5x 2.5x 2.4x NA NA 4% 5% 6% 11% 15% 16% 22% 22% 30% 36% 14.0 Weighted Average Lease Term (# of Years) 14.6 10.5 10.8 10.0 9.8 9.9 10.7 9.0 8.4 88% 80% 38% 36% 35% 27% 23% 22% 19% 17% 100% 100% 96% 72% 63% 49% 44% 39% 39% 24% Different
Slide 15: 2021E AFFO per Share Multiple and Growth
Investor Presentation – January 202114 18.0% 9.9% 8.8% 8.2% 7.0% 6.0% 5.7% 3.3% 3.2% 1.8% 9.3% 7.2% 6.8% 5.3% 5.0% 4.8% 4.2% 3.3% 1.2% (0.4%) 18.3x 18.1x 16.9x 16.7x 15.9x 14.3x 14.1x 13.7x 13.1x 11.7x 2021E AFFO per Share Multiple1 2021E AFFO per Share Growth2 Source: Public filings, FactSet and SN
Slide 16: Appendix
Appendix
Slide 17: Debt Structure Allows for Capital Flexibility
Investor Presentation – January 202116 $1 $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
Slide 18: Leasing Summary
Investor Presentation – January 202117 Leasing Summary Lease Escalations Lease Escalation Frequency Lease Escalation Type • Leases contributing 99% of cash ABR provided for base rent escalation, generally ranging from 1.0% to 3.0% annually, with a weighted average annual escalation rate of 1.5%, whi
Slide 19: Financial Summary – 3Q'2020 Statements of Operations
Investor Presentation – January 202118 Financial Summary – 3Q’2020 Consolidated Statements of Operations Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except share and per share data) 2020 2019 2020 2019 (unaudited) (unaudited) (unaudited) (unaudited) Revenues: Rent
Slide 20: Financial Summary – 3Q'2020 FFO and AFFO
Investor Presentation – January 202119 Financial Summary – 3Q’2020 Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) Three months ended September 30, Nine months ended September 30, (unaudited, in thousands except per share amounts) 2020 2019 2020 2019 Net income $ 12,336 $ 14,10
Slide 21: Financial Summary – 3Q'2020 Consolidated Balance Sheets
Investor Presentation – January 202120 Financial Summary – 3Q’2020 Consolidated Balance Sheets September 30, 2020 December 31, 2019 (in thousands, except share and per share amounts) (unaudited) (audited) ASSETS Investments: Real estate investments, at cost: Land and improvements $ 686,908 $ 588,279
Slide 22: GAAP Reconciliations to EBITDAre, NOI and Run Rate Metrics
Investor Presentation – January 202121 Financial Summary – 3Q’2020 GAAP Reconciliations to EBITDAre, GAAP NOI, Cash NOI and Estimated Run Rate Metrics Three Months Ended (unaudited, in thousands) September 30, 2020 Net income $ 12,336 Interest expense 7,651 Depreciation and amortization 13,966 Inter
Slide 23: Market Capitalization, Debt Summary and Leverage Metrics
Investor Presentation – January 202122 Financial Summary – 3Q’2020 Market Capitalization, Debt Summary and Leverage Metrics (dollars in thousands, except share and per share amounts) September 30, 2020 Rate Maturity1 Secured debt: Series 2017-1, Class A $ 158,513 4.10% 3.7 years Series 2017-1, Class
Slide 24: Glossary
Investor Presentation – January 202123 Glossary Supplemental Reporting Measures and Other Terms 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 operati
Slide 25: Glossary
Investor Presentation – January 202124 Glossary Supplemental Reporting Measures and Other Terms 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
Slide 26: Glossary
Investor Presentation – January 202125 Glossary Supplemental Reporting Measures and Other Terms Adjusted EBITDAre / Adjusted NOI / Adjusted Cash NOI We further adjust EBITDAre, NOI and Cash NOI i) based on an estimate calculated as if all investment and disposition activity that took place during th
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