Global Net Lease, Inc. · NYSE:GNL
Global Net Lease — Q1 2020 Earnings Presentation
30 slides from Global Net Lease's earnings presentation, May 2020
Slide 1: Global Net Lease First Quarter 2020 Investor Presentation
Global Net Lease First Quarter 2020 Investor Presentation
Slide 2: Corporate Update
CORPORATE UPDATE GNL’s focused effort in response to the COVID-19 crisis resulted in 98% of April Cash Rent(1) collected Resilient Portfolio Built for Success: We believe the financial strength, creditworthiness of our tenants and diversity within our portfolio will offset the potential effects of
Slide 3: April Cash Rent Collection
APRIL CASH RENT COLLECTION GNL collected 98% of April Cash Rent helped by our balance of mission critical industrial assets and primarily Investment Grade rated tenants(1) April Rent Collection (Total Portfolio) April Rent Collection (United States) Other(2) Other < 1% Deferral in < 1% Deferral in N
Slide 4: Top Twenty Tenants
TOP TWENTY TENANTS GNL received 100% of April Cash Rent due from the Company’s top twenty Tenants(1), representing 48% of the Company’s annual base rent(2) Top Twenty Tenants Investment Grade % of April Annual Base Rent Tenant Country Tenant Industry Rating Cash Rent Paid % Portfolio(2) FedEx Baa2**
Slide 5: Overview
OVERVIEW High-Quality, Mission Critical, Net Lease Focused Portfolio Long Duration Leases to Primarily Investment Grade Rated Tenants(1) Differentiated Strategy with International Diversification Strenuous Due Diligence and Underwriting Standards Proactive Asset Management Program to Drive Long Term
Slide 6: Portfolio Highlights
PORTFOLIO HIGHLIGHTS Portfolio Overview Properties 288 Square Feet (millions) 34.2 Tenants 126 Industries 46 Countries 9 Leased 99.6% Weighted-Average Remaining Lease Term(1) 9.0 years % of SLR derived from Investment Grade Tenants(2)(3) 66.7% % of leases with contractual rent increases(4) 93.7% As
Slide 7: Well Balanced Portfolio
WELL BALANCED PORTFOLIO Credit Rating(1) Geography(1) United Kingdom 17% Non Investment Grade 33% Finland 5% The Netherlands 4% France 4% (2) United States Investment Grade 63% Germany 3% 67% Luxembourg 2% Italy, Puerto Rico and Canada 2% Asset Type(1) Tenant Industry(1) Retail 5% Financial Services
Slide 8: Well Diversified Tenant Base
WELL DIVERSIFIED TENANT BASE Top Ten Tenants Property % of Tenant Rating Country Type SLR (1) U.S. / Baa2** Distribution 5% Canada U.S. / Industrial / Baa1* 4% Italy Distribution Aaa** U.S. Office 4% Baa2 U.K. Office 3% Aa3 NETH Office 3% Baa2 U.S. Distribution 3% Ba1* U.S. Industrial 3% Aa1** FIN I
Slide 9: Focus on High-Quality Tenants
FOCUS ON HIGH-QUALITY TENANTS Best-in-class portfolio leased to largely Investment Grade Rated Tenants(1) in well established markets in the U.S. and Europe Only Focused on Markets with Quality Sovereign Debt Ratings (S&P) The U.S. Luxembourg Germany Canada Finland U.K. France Italy Netherlands AA+
Slide 10: Differentiated Investment Strategy
DIFFERENTIATED INVESTMENT STRATEGY Focused on single-tenant commercial properties to generate superior risk-adjusted returns • Focus on the U.S. and strong sovereign debt rated countries in Geography Continental Europe • Mission critical, single tenant net lease corporate and headquarter sites Asset
Slide 11: 2020 Acquisition Activity
2020 ACQUISITION ACTIVITY Acquisitions represent management’s ability to leverage direct relationships with landlords and developers to generate off-market transactions, allowing the Company to achieve what it believes to be better than market cap rates Credit Purchase Price Average Lease Term Acqui
Slide 12: Geographic Balance (as of March 31, 2020)
GEOGRAPHIC BALANCE (AS OF MARCH 31, 2020) U.S. and Canada Europe Number of Assets: 223 Number of Assets: 65 Weighted-Average Remaining Lease Term: 9.5 years(1) Weighted-Average Remaining Lease Term: 7.7 years(1) % of GNL SLR: 64.6%(2) % of GNL SLR: 35.4%(2) 1. Refer to basis for metric calculation i
Slide 13: Portfolio Comparison: Q1 2020 vs Q1 2019
PORTFOLIO COMPARISON: Q1 2020 VS Q1 2019 Continued Focus towards United States Industrial and Distribution Properties Property Type Concentration(1) Geographic Concentration(1) Retail 8% As of March 31, 2019 As of March 31, 2019 Europe Office 53% 44% Industrial/Distribution 39% United States 56% As
Slide 14: First Quarter Acquisition: Central States Thermo King, Inc.
FIRST QUARTER ACQUISITION: CENTRAL STATES THERMO KING, INC. Transaction Overview Property and Tenant Overview Tenant Central States Thermo King of St. Louis, LLC Tenant Property Type Distribution/Industrial • The Tenant, Central States Thermo King of St. Louis, LLC, is a wholly owned subsidiary of t
Slide 15: First Quarter Acquisition: FedEx Ground
FIRST QUARTER ACQUISITION: FEDEX GROUND Transaction Overview(1) Property and Tenant Overview Tenant FedEx Ground Package Systems, Inc. Tenant Property Type Distribution • The Tenant, FedEx Ground Package Systems, Inc., is a wholly owned subsidiary of FedEx Corporation (NYSE:FDX), a leading provider
Slide 16: Fully Aligned Management Structure
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 James L. Nelson Chris Masterson Chief Executive Officer and President Chief Financial Officer, Treasur
Slide 17: GNL Capital Structure
GNL CAPITAL STRUCTURE GNL increased the Company’s cash position during the first quarter by borrowing $205 million under the Company’s credit facility, increasing its flexibility and cash position to $348 million GNL Capital Structure by Quarter(1) Debt Maturity and Interest Expense by Quarter(1) (i
Slide 18: Performance Metrics
PERFORMANCE METRICS Q1 2020 Key Highlights • First quarter acquisitions of $113.9 million plus Q2’2020 pipeline of $56.8 million to be acquired at a weighted average cap rate of 8.8%(1) • Collected 98% of April Cash Rent due including 100% of April Cash Rent due from the Company’s top twenty tenants
Slide 19: Debt Overview
DEBT OVERVIEW Debt Metrics Debt by Currency Metric Q1’20 GBP Net Debt to Enterprise Value(1) 55.0% 16% Net Debt to Adjusted EBITDA (annualized)(2) 7.1x USD 46% Interest Coverage Ratio(3) 4.1x Weighted-Average Interest Rate(4) 3.1% EUR Weighted-Average Debt Maturity(5) 5.4 Years 38% Floating Rate / F
Slide 20: Comprehensive Hedging Program
COMPREHENSIVE HEDGING PROGRAM GNL continues to employ a comprehensive hedging program, with a number of components designed to limit the impact of currency and interest rate movements to its European portfolio Hedging Foreign Currency Exchange Risk • Provides protection against unfavorable movements
Slide 21: Forward Looking Statements
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,” “wi
Slide 22: 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. • All of our executive officers are also officers, managers, employees or hol
Slide 23: Risk Factors (Continued)
RISK FACTORS (CONTINUED) • If we are not able to increase the amount of cash we have available to pay dividends, including through additional cash flows we expect to generate from completing acquisitions, we may have to reduce dividend payments or identify other financing sources to fund the payment
Slide 24: Projections
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 presentation
Slide 25: 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 26: 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 to da
Slide 27: Definitions (Continued)
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 fluct
Slide 28: Non-GAAP Reconciliations
NON – GAAP RECONCILIATIONS Three Months Ended March 31, 2020 March 31, 2019 EBITDA: Net income (loss) $ 9,601 $ (8,276) Depreciation and amortization 33,533 31,303 Interest expense 16,440 15,162 Income tax expense 959 960 EBITDA 60,533 55,701 Equity based compensation 2,488 2,109 Acquisition, transa
Slide 29: FFO and AFFO Reconciliations
FFO AND AFFO RECONCILIATIONS Three Months Ended March 31, 2020 March 31, 2019 Funds from operations (FFO): Net income (loss) attributable to common stockholders (in accordance with GAAP) $ 5,038 $ 5,791 Depreciation and amortization 33,533 31,303 Gain (loss) on dispositions of real estate investment
Slide 30: www.GlobalNetLease.com
www.GlobalNetLease.com INVESTOR INQUIRIES 1-866-902-0063 investorrelations@globalnetlease.com