Essential Properties Realty Trust, Inc. · NYSE:EPRT
Essential Properties Realty Trust — Investor Presentation (May 2024)
33 slides from Essential Properties Realty Trust's investor presentation, May 9, 2024
Slide 1: Investor Presentation May 2024
Investor Presentation – May 20240 Investor Presentation May 2024 Exhibit 99.1
Slide 2: Disclaimer
Investor Presentation – May 20241 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,” “p
Slide 3: Business Update: Continuing to Execute Our Business Plan
Investor Presentation – May 20242 Healthy Net Lease Portfolio1 • Stable Portfolio: 99.9% leased; same-store rent growth has averaged 1.4% over the last four quarters • Strong Coverage: Unit-level coverage of 3.9x with ~99% of ABR required to report unit-level P&Ls • De-Minimis Lease Expiration Risk:
Slide 4: Investment Highlights
Investor Presentation – May 20243 Investment Highlights • Newly Assembled Portfolio of Net Lease Properties • Long Duration Leases with Strong Unit-Level Rent Coverage • Focused on Service-Oriented and Experience-Based Tenants • Fungible and Smaller-Scale Single-Tenant Properties • Differentiated, D
Slide 5: Focused Investment Strategy Based on Decades of Experience
Investor Presentation – May 20244 Focused Investment Strategy Based on Decades of Experience Investment Discipline Refined Over Multiple Decades Across Various Credit Cycles Service-Oriented & Experience-Based Industries Sale-Leaseback Transactions - Middle-Market Tenants Small-Scale Fungible Net Le
Slide 6: Relationship Based Strategy – Capital Provider of Choice
Investor Presentation – May 20245 Relationship Based Strategy – Capital Provider of Choice Actively Leveraging Our Relationships to Directly Originate New Investment Opportunities Relationship-Based Sourcing 1. Percentage of portfolio cash ABR as of March 31, 2024 that was acquired from parties who
Slide 7: Portfolio Review
Portfolio Review
Slide 8: New Vintage Portfolio Focused on Targeted Industries
Investor Presentation – May 20247 New Vintage Portfolio Focused on Targeted Industries Disciplined Investing Focused on Service-Oriented and Experience-Based Businesses with Unit-Level Reporting 1. As of March 31, 2024 2. Includes 135 properties that secure mortgage loans receivable. 3. Exclusive of
Slide 9: Top Tenant Concentration
Investor Presentation – May 20248 Top 10 Tenant Concentration Highly Diversified Portfolio by Tenant: Top 10 Tenants Represent only 19% of Total Cash ABR1 Top 10 Tenants1 Diversification by Industry1 Top 10 Tenants1 Properties2 % of Cash ABR 54 4.3% 8 2.2% 31 1.8% 16 1.6% 25 1.6% 28 1.6% 40 1.5% 6 1
Slide 10: Diversified Portfolio – Our Tenants Identify the Location of Opportunities
Investor Presentation – May 20249 Diversified Portfolio – Our Tenants Identify the Location of Opportunities Geographical Diversity is an Output of our Strategy • Geographic Diversity1 ~80% of Total Cash ABR comes from Top 21 States (States with >2.0% of our total ABR) ~50% of Total Cash ABR comes f
Slide 11: Established and Proven Investment Platform
Investor Presentation – May 202410 Established and Proven Investment Platform Scalable Infrastructure – Consistent Investment Sourcing at Attractive Yields without Sacrificing Quality $175,738 $195,454 $328,370 $207,147 $277,361 $213,327 $314,865 $248,770 $0 $40,000 $80,000 $120,000 $160,000 $200,00
Slide 12: Active Asset Management
Investor Presentation – May 202411 Active Asset Management Proactive Asset Management Mitigates Risk, Optimizes Accretive Capital Recycling 1. Includes the impact of transaction costs. 2. Gains/(losses) based on our initial purchase price. 3. Cash ABR at time of sale divided by gross sale price (exc
Slide 13: Leasing Summary
Investor Presentation – May 202412 Leasing Summary Consistent Contractual Rent Escalations Generate Dependable Internal Growth Lease Escalation Frequency Lease Escalation Type 1. Based on cash ABR as of March 31, 2024. 2. Represents the weighted average annual escalation rate of the entire portfolio
Slide 14: Same-Store Rent Growth
Investor Presentation – May 202413 Same-Store Rent Growth Alignment with Average Contractual Rent Bumps is an Indicator of Limited Credit Loss Experience Same-Store Portfolio Performance1 Trailing 4 Qtr. Avg. Same-Store Rent Growth1 Contractual Cash Rent ($000s) 2 % Type of Business 1Q’23 1Q’24 Chan
Slide 15: Tenant Financial Reporting Requirements
Investor Presentation – May 202414 Tenant Financial Reporting Requirements1 % of Cash ABR by Unit-Level Coverage Tranche1,2 Unit-Level Coverage by Lease Expiration1Unit-Level Coverage by Tenant Credit3 Reporting Requirements % of Cash ABR Unit-Level Financial Information 98.9% Corporate-Level Financ
Slide 16: Leverage & Liquidity
EPRT Board Meeting Management Presentation First Quarter Ended March 31, 2023 Leverage & Liquidity
Slide 17: Conservative and Flexible Debt Structure
Investor Presentation – May 202416 Conservative and Flexible Debt Structure 100% Unsecured Debt – 100% Unencumbered Asset Base – Minimal Near-Term Debt Maturities – Investment Grade Debt Maturity Schedule1 • Well-Laddered Maturities1: • Low-Cost Debt Structure2: • 100% Unsecured Balance Sheet: • Fle
Slide 18: Consistently Strong Liquidity to Fund Growth
Investor Presentation – May 202417 Consistently Strong Liquidity to Fund Growth ($mm) Strong Liquidity to Drive Leading AFFO/sh Growth $863mm of Liquidity1 and Balance Sheet Capacity to Support External Growth Aspirations ($mm) 1Q’24 Pro Forma 1Q’241 Cash $ 79.2 $ 263.3 Unused Revolver Capacity 600.
Slide 19: Peer Comparison
Peer Comparison
Slide 20: Differentiated Net Lease Investment Opportunity
Investor Presentation – May 202419 4.9x 3.9x 3.4x 2.9x 2.6x NR NR NR NR 70% 68% 54% 37% 32% 27% 21% 20% 19% 2% 4% 6% 8% 9% 11% 12% 12% 12% 98% 93% 90% 70% 37% 36% 28% 24% 15% Differentiated Net Lease Investment Opportunity Portfolio Mix and Underlying Fundamentals are Favorable Relative to Peers Str
Slide 21: Peer Valuation and Leverage Comparison
Investor Presentation – May 202420 2.5x 3.6x 4.6x 4.7x 5.0x 5.4x 5.5x 5.6x 5.7x 15.5x 14.3x 14.1x 13.8x 13.3x 12.5x 12.2x 12.1x 10.8x 5.3% 4.0% 3.9% 3.3% 2.7% 2.3% 0.7% 0.2% NA Source: Public filings, FactSet and S&P Capital IQ. Note: Market data as of May 3, 2024. 1. 2024E AFFO per share multiple c
Slide 22: Commitment to ESG
Commitment to ESG
Slide 23: Environmental, Social and Governance
Investor Presentation – May 202422 Governance Leading governance practices, Board accountability, strong board diversity, required minimum stock ownership, published compensation clawback policy, and no hedging or pledging Industry recognized investor engagement and disclosure practices Environmenta
Slide 24: Financials
PRINCETON A AR WASH= FREE VRCUUM Financials
Slide 25: Financial Summary – 1Q'24 Statements of Operations
Investor Presentation – May 202424 Financial Summary – 1Q’24 Consolidated Statements of Operations Three Months Ended March 31, (in thousands, except share and per share data) 2024 2023 (unaudited) (unaudited) Revenues: Rental revenue1,2 $ 98,510 $ 78,172 Interest on loans and direct financing lease
Slide 26: Financial Summary – 1Q'24 FFO and AFFO
Investor Presentation – May 202425 Financial Summary – 1Q’24 Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) Three Months Ended March 31, (unaudited, in thousands except per share amounts) 2024 2023 Net income $ 47,123 $ 43,056 Depreciation and amortization of real estate 28,48
Slide 27: Financial Summary – 1Q'24 Consolidated Balance Sheets
Investor Presentation – May 202426 Financial Summary – 1Q’24 Consolidated Balance Sheets (in thousands, except share and per share amounts) March 31, 2024 December 31, 2023 ASSETS (unaudited) (audited) Investments: Real estate investments, at cost: Land and improvements $ 1,635,673 $ 1,542,302 Build
Slide 28: Financial Summary – 1Q'24 GAAP Reconciliations to EBITDAre, NOI
Investor Presentation – May 202427 Financial Summary – 1Q’24 GAAP Reconciliations to EBITDAre, GAAP NOI, Cash NOI and Estimated Run Rate Metrics Three Months Ended (unaudited, in thousands) March 31, 2024 Net income $ 47,123 Depreciation and amortization 28,525 Interest expense 15,597 Interest incom
Slide 29: Financial Summary – 1Q'24 Market Capitalization, Debt Summary and Leverage
Investor Presentation – May 202428 Financial Summary – 1Q’24 Market Capitalization, Debt Summary and Leverage Metrics (dollars in thousands, except share and per share amounts) March 31, 2024 Rate Wtd. Avg. Maturity Unsecured debt: February 2027 term loan1 $ 430,000 2.4% 2.9 years January 2028 term
Slide 30: Glossary
Glossary
Slide 31: Glossary: Supplemental Reporting Measures
Investor Presentation – May 202430 Glossary Supplemental Reporting Measures 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 operations (“Core FFO”) and
Slide 32: Glossary: Supplemental Reporting Measures (EBITDA and EBITDAre)
Investor Presentation – May 202431 Glossary Supplemental Reporting Measures 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 real estate impairme
Slide 33: Glossary: Adjusted EBITDAre / Adjusted NOI / Adjusted Cash NOI
Investor Presentation – May 202432 Glossary Supplemental Reporting Measures Adjusted EBITDAre / Adjusted NOI / Adjusted Cash NOI We further adjust EBITDAre, NOI and Cash NOI i) based on an estimate calculated as if all re-leasing, investment and disposition activity that took place during the quarte
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