Four Corners Property Trust, Inc. · NYSE:FCPT
Four Corners Property Trust — Investor Presentation (March 2018)
29 slides from Four Corners Property Trust's investor presentation, Mar 30, 2018
Slide 1: Investor Presentation April 2018
| FCPT | APRIL 20181 INVESTOR PRESENTATION | APRIL 2018 www.fcpt .com FOUR CORNERS PROPERTY TRUST N YS E : F C P T
Slide 2: Forward Looking Statements and Disclaimers
| FCPT | APRIL 20182 FORWARD LOOKING STATEMENTS AND DISCLAIMERS Cautionary Note Regarding Forward-Looking Statements: This presentation contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements include all statements that are not historical sta
Slide 3: Agenda
| FCPT | APRIL 20183 AGENDA Company Overview and Update Page 3 Diversification and Acquisition Strategy Page 16 Financial Update & Key Credit Strengths Page 25 Key Investment Highlights Page 11
Slide 4: Senior Management Team
| FCPT | APRIL 20184 SENIOR MANAGEMENT TEAM William Lenehan President and CEO Gerald Morgan CFO Former Board member and Chair of the Finance and Real Estate Committee at Darden Restaurants, Inc. Private investor in net lease retail real estate Member of the Board of Directors of Macy’s, Inc.
Slide 5: Overview of FCPT
| FCPT | APRIL 20185 OVERVIEW OF FCPT Four Corners Property Trust (“FCPT”) is an investment grade rated REIT primarily engaged in the ownership, acquisition, and leasing of restaurant properties 527 properties, diversified by geography and brand, 415 of which are leased to Darden under long- ter
Slide 6: 2017 Year in Review & Recent Updates
| FCPT | APRIL 20186 2017 YEAR IN REVIEW & RECENT UPDATES • Announced an increase in the annual dividend to $1.10 per share (over 13% increase from prior dividend) • Active acquisitions & portfolio management program focused on high credit quality operators: • Announced a strategic agreement to acqu
Slide 7: Case Study: FCPT and Washington Prime
| FCPT | APRIL 20187 CASE STUDY: FCPT AND WASHINGTON PRIME • On September 20, 2017, FCPT announced the acquisition of 41 restaurant properties from Washington Prime Group (“WPG”) for a purchase price of approximately $67 million (6.7% initial cash yield) with a weighted average remaining 8 year leas
Slide 8: FCPT Closed Acquisitions
| FCPT | APRIL 20188 FCPT CLOSED ACQUISIT IONS Note: Figures updated as of 3/31/2018. Tenant Location # of Properties Operator / Guarantor Information Purchase Price ($mm) Initial Cash Yield Term (yrs) Annualized Rent Bumps Announced Pizza Hut IL, IN 6 40-unit sub. of 150-unit operator $5.7 7.2% 20
Slide 9: FCPT Closed Dispositions
| FCPT | APRIL 20189 FCPT CLOSED DISPOSIT IONS Note: Figures updated as of 3/31/2018. FCPT remains a net acquirer of real estate While the company receives many unsolicited offers to sell properties, only opportunistic and attractive cap rate offers are considered All proceeds from sales excha
Slide 10: National Footprint with Increasing Brand Diversification
| FCPT | APRIL 201810 527 Properties 44 States 28 Brands 3.7 million sq ft NATIONAL FOOTPRINT WITH INCREASING BRAND DIVERSIF ICATION Portfolio at Inception Acquired Properties MN SD NJ OH INIL VT NHID AL AZ AR CA CO CT DE FL GA IA KS KY LA ME MD MA MI MS MO MT NE NV NM NY NC ND OK OR PA RI SC TN TX
Slide 11: Agenda
| FCPT | APRIL 201811 AGENDA Company Overview and Update Page 3 Diversification and Acquisition Strategy Page 16 Financial Update & Key Credit Strengths Page 25 Key Investment Highlights Page 11
Slide 12: High Quality Portfolio
| FCPT | APRIL 201812 HIGH QUALITY PORTFOLIO Properties: • 527 Properties • 87% Investment grade tenancy • 28 brands – 16 Quick Service & Fast Casual / 12 Casual, Family & Fine Dining Geography: • 44 states • Only Florida (10.8%) and Texas (10.6%) are above 10% of NOI Term Remaining: • 12.7 years •
Slide 13: Portfolio Diversification
| FCPT | APRIL 201813 PORTFOLIO DIVERSIF ICATION ___________________________ 1. Current scheduled minimum contractual rent as of 3/31/2018. Brand Breakdown by Annual Base Rent (ABR) 18% 105 units 4% 13 units 13% 112 units 65% 297 units 74% 20% 6% Initial Portfolio: Rental Revenue of $94.4 million (A
Slide 14: Lease Maturity Schedule
| FCPT | APRIL 201814 LEASE MATURITY SCHEDULE ___________________________ 1. Current scheduled minimum contractual rent as of 3/31/2018 2. Calculated by square feet Note: Excludes renewal options. 0.0% 0.0% 0.2% 0.2% 0.3% 0.3% 0.1% 0.1% 0.2% 15.2% 15.8% 14.1% 13.7% 12.8% 9.6% 8.6% 0.7% 0.0% 3.6% 3.7
Slide 15: FCPT's Portfolio Compares Favorably Across Major Metrics
| FCPT | APRIL 201815 N/A N/A 2.1x 2.6x 2.8x 3.6x 4.6x ADC VEREIT Spirit STORE Realty National Retail FCPT 54% 64% 81% 85% 100% 100% 100% STOR VER O SRC ADC NNN FCPT 20% 24% 37% 40% 44% 46% 87% STOR NNN SRC VER ADC O FCPT ___________________________ Sources: FCPT figures as of 3/31/2018, except EBIT
Slide 16: Agenda
| FCPT | APRIL 201816 AGENDA Company Overview and Update Page 3 Diversification and Acquisition Strategy Page 16 Financial Update & Key Credit Strengths Page 25 Key Investment Highlights Page 11
Slide 17: Business Plan and Diversification Strategy
| FCPT | APRIL 201817 BUSINESS PLAN AND DIVERSIF ICATION STRATEGY FCPT has a core portfolio that provides stable cash flow, as well as a strong balance sheet to support diversification growth objectives Start with 100% concentration in casual dining, but an extremely strong tenant with an investme
Slide 18: FCPT Acquisition Philosophy and Underwriting Criteria
| FCPT | APRIL 201818 FCPT ACQUISIT ION PHILOSOPHY AND UNDERWRITING CRITERIA Acquisition Philosophy • Acquire nationally recognized branded restaurants that are well located with creditworthy lease guarantors • Purchase assets only when accretive to cost of capital • Increase diversification by targ
Slide 19: Conceptual Underwriting Strike Zone
| FCPT | APRIL 201819 0 1 2 3 4 5 6 7 8 9 10 Screened / Passed Closed, Under Contract, Negotiating LOI “TedWilliams described in his book, The Science of Hitting, that the most important thing, for a hitter, is to wait for the right pitch…and that's exactly the philosophy I have about investing...wa
Slide 20: Vast Addressable Market Within Restaurant Industry Subsectors
| FCPT | APRIL 201820 VAST ADDRESSABLE MARKET WITHIN RESTAURANT INDUSTRY SUBSECTORS ✓~✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓✓ ✓~ Source: Census Bureau, Bureau of Economic Analysis, Wall Street Research as of March 2017; Data as of December 2015. Retail Sales $4.85T Net Exports -$0.5T US GDP – $17.9 Trillion Food Service
Slide 21: Industry Benchmarking
| FCPT | APRIL 201821 INDUSTRY BENCHMARKING Note: Green font denotes FCPT owned brands and orange font denotes brands that FCPT is under contract to purchase per the announced Washington Prime Group transaction. FCPT is focused on acquiring restaurants operated by top brands within each cuisine type
Slide 22: Food & Beverage Seems Most Resilient to E-Commerce
| FCPT | APRIL 201822 US eCommerce Penetration by Retail Category (2016) 46.7% 31.8% 16.4% 14.8% 11.1% 11.0% 10.5% 7.3% 2.8% 0.9% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Consumer Electronics Books & Magazines Toys & Hobbies Apparel & Accessories Health & Personal Care Jewelry & Watches Sports & Fi
Slide 23: Rapid Franchisee Consolidation Within Restaurant Industry
| FCPT | APRIL 201823 RAPID FRANCHISEE CONSOLIDATION WITHIN RESTAURANT INDUSTRY Units Owned by the Top 200 Franchisees Average units per Top 200 Franchisees 16,715 17,887 18,408 20,331 21,831 23,177 25,176 26,997 0 4,000 8,000 12,000 16,000 20,000 24,000 28,000 2009 2010 2011 2012 2013 2014 2015 201
Slide 24: Thoughtful Brand Selection Aimed at Protecting Cash Flow
| FCPT | APRIL 201824 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 Brands with mid-range sales have more options for re-tenanting in case of vacancy THOUGHTFUL BRAND SELECTION AIMED AT PROTECTING CASH FLOW Casual Dining Fast Casual Quick Service ___________________________ Source: Brand average sale
Slide 25: Agenda
| FCPT | APRIL 201825 AGENDA Company Overview and Update Page 3 Diversification and Acquisition Strategy Page 16 Financial Update & Key Credit Strengths Page 25 Key Investment Highlights Page 11
Slide 26: Current Capitalization and Trading Metrics
| FCPT | APRIL 201826 Current Capitalization Current Trading Metrics ($ million, except per share) Cash NOI ($ million) 3 $109.4 Share price (3/29/2018) $23.09 Implied Cap Rate 5.7% Shares and OP units outstanding (millions) 61.8 Consensus AFFO per share (12 month forward) $1.37 Equity value $1,427
Slide 27: FCPT Debt Maturity Schedule
| FCPT | APRIL 201827 FCPT DEBT MATURITY SCHEDULE ___________________________ Figures as of 3/31/2018. 1. Excludes undrawn revolver Current Debt Maturity Schedule1 $0 $0 $0 $250 $400 $0 $50 $0 $0 $75 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Unsecured Notes Undrawn Revolver Capacity Drawn Re
Slide 28: Key Investment Highlights
| FCPT | APRIL 201828 High Quality Portfolio Diversified by Geography and Brand Well-located assets diversified geographically across 44 states in the U.S. Darden property-level revenue ~50% above casual dining peers Sales of Darden branded assets demonstrate strong underlying value and liquid
Slide 29: Four Corners Property Trust
| FCPT | APRIL 201829 FOUR CORNERS PROPERTY TRUST N YS E : F C P T
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