Global Net Lease, Inc. · NYSE:GNL
Global Net Lease — Q4 2023 Earnings Presentation
29 slides from Global Net Lease's earnings presentation, Feb 28, 2024
Slide 1: Global Net Lease Fourth Quarter 2023 Investor Presentation
Global Net Lease Pictured – McLaren Campus in Woking, U.K. Fourth Quarter 2023 Investor Presentation
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation contains statements that are not historical facts and may be forward-looking statements, including statements regarding the intent, belief or current expectations of us, our operating partnership and members of our management team, as well as the assumpti
Slide 3: Projections
PROJECTIONS This presentation also includes estimated projections of future operating results. These projections are 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 presentatio
Slide 4: 2024 Business Plan
2024 BUSINESS PLAN GNL is implementing a 2024 business plan focused on delevering its balance sheet, reducing its exposure to variable rate debt and driving down its net debt to Adjusted EBITDA Lease-Up Potential Continued successful lease-up of multi-tenant portfolio with positive renewal spreads;
Slide 5: Global Net Lease Highlights
GLOBAL NET LEASE HIGHLIGHTS GNL’s 2024 business plan will reduce leverage through dispositions, including non-core assets and opportunistic sales. The focus of 2024 for GNL will be to lower our cost of capital, enhance our balance sheet to align with our peers and increase our AFFO(1) multiple as we
Slide 6: 2024 Initial Guidance
2024 INITIAL GUIDANCE GNL’s objective is to provide investors with enhanced transparency regarding our financial goals and projections, and therefore we would like to introduce initial 2024 guidance ▪ The initial guidance reflects our expectation that projected 2024 dispositions will be in the range
Slide 7: Fourth Quarter 2023 Financial Highlights
FOURTH QUARTER 2023 FINANCIAL HIGHLIGHTS GNL will continue to focus on improving its operating metrics including reducing net debt to Adjusted EBITDA, decreasing interest expense, addressing near-term leases while decreasing our cost of capital and disposing of non-core assets Debt Capitalization ($
Slide 8: GNL Disposition and Balance Sheet Strategy
GNL DISPOSITION AND BALANCE SHEET STRATEGY Balance Sheet Highlights Planned 2024 Dispositions ▪ In 2024, GNL will reduce leverage through strategic dispositions, Amount addressing near-term debt maturities and generating excess cash to Status Timing Notes ($mm) enhance our balance sheet Includes $35
Slide 9: Substantial Merger Synergies and Internalization Savings
SUBSTANTIAL MERGER SYNERGIES AND INTERNALIZATION SAVINGS As a direct result of the Merger, GNL has already recognized $67.6(2) million of annualized cost synergies and is on track to recognize $75 million that was estimated at transaction close(1) ($mm) Synergies Recognized in Q4 2023 (000’s)(2) $7
Slide 10: Portfolio Snapshot
PORTFOLIO SNAPSHOT Portfolio Overview Q4’23 Properties 1,296 Square Feet (millions) 66.8 % Leased 96% Weighted Average Remaining Lease Term (“WALT”)(1) 6.8 years % of SLR Derived from United States & Canada vs. Europe 80% | 20% Industries 94 Tenants 803 % of SLR derived from Investment Grade Tenants
Slide 11: High-Quality Investment-Grade Tenants
HIGH-QUALITY INVESTMENT-GRADE TENANTS Top ten tenants represent 21.0% of SLR with no single tenant accounting for more than 3.1% Top Ten Tenants Tenant Credit Rating Country Property Type % of SLR(1) Implied: Baa2 U.S. Single-Tenant Retail 3.1% Actual: B- U.K. Industrial & Distribution 2.7% Actual:
Slide 12: Third-Largest Publicly Traded Net Lease REIT with a Global Presence
THIRD-LARGEST PUBLICLY TRADED NET LEASE REIT WITH A GLOBAL PRESENCE Geographic Presence FIN NEW PACIFIC BRUNSWICK NORTHWEST NB WA MIDWEST ME NETH NORTHEAST MT ND VT NH LUX OR MA UK MN NY ID SD WI RI MI GER WY NJ CT PA IA DE MID- CI NE OH NV IL IN MD UT WV VA DC ATLANTIC CA CO NC KS MO KY FR NC TN OK
Slide 13: Attractive Lease Maturity Schedule
ATTRACTIVE LEASE MATURITY SCHEDULE Unique investment mix of stable, long-term, single-tenant net-leased and strategically located suburban shopping centers results in a favorable lease maturity schedule and a Weighted Average Remaining Lease Term of 6.8 years(1) Multi-Tenant Retail Lease Maturity Sc
Slide 14: Continued Leasing Momentum Driven by Strong Asset Management Capabilities
CONTINUED LEASING MOMENTUM DRIVEN BY STRONG ASSET MANAGEMENT CAPABILITIES Leasing momentum continues in Q4 2023 with 70 lease renewals and new leases, combining for over 2.1 million square feet and over $19 million of net straight-line rent Q4 2023(1) Leasing and Renewal Activity Single-Tenant Portf
Slide 15: Well Positioned Portfolio with Key Metrics
WELL POSITIONED PORTFOLIO WITH KEY METRICS Industrial & Multi-Tenant Single-Tenant Single-Tenant Total Portfolio(1) Industrial Distribution + Retail + Retail + Office Number of 1,296 219 109 878 90 Properties Square Feet 66.8 33.9 16.4 7.9 8.6 (millions) SLR $731 $235 $200 $154 $143 ($ millions) % L
Slide 16: Diversified and Stable Tenant Base
DIVERSIFIED AND STABLE TENANT BASE Asset Diversification Credit Rating(1)(2) Total Portfolio Annualized SLR by Segment Not Rated 6% Single-Tenant Single-Tenant Retail Office 21% 20% Single-Tenant Non-Investment Investment Grade (2) $730.9 73% Grade 58% million 36% Multi-Tenant Industrial & Retail Di
Slide 17: Industrial & Distribution Overview
INDUSTRIAL & DISTRIBUTION OVERVIEW Segment Highlights Lease Maturity Schedule (% of Total SF) 32% 219 33.9M 7.7 Years Weighted Average Lease Term Total Portfolio(1) Properties Square Feet 32.9% 18% 100% 7.7 Years CPI Increases(1) Leased WALT 6.3% 8.0% 57% 92% 1.5% 2.5% Average Annual 1.4% 1.5% IG Te
Slide 18: Multi-Tenant Retail Overview
MULTI-TENANT RETAIL OVERVIEW Segment Highlights Lease Maturity Schedule (% of Total SF) 5.2 Years Weighted Average Lease Term 27% 109 16.4M Total Portfolio(1) Properties Square Feet Anchor Tenants: In-Line Tenants: 5.5 Years 4.0 Years 9.7% $200M 90.5% 5.2 Years SLR Leased + Pipeline WALT 3.5% 2.7% 2
Slide 19: Single-Tenant Retail Overview
SINGLE-TENANT RETAIL OVERVIEW Segment Highlights Lease Maturity Schedule (% of Total SF) 21% 878 7.9M 8.3 Years Weighted Average Lease Term Total Portfolio(1) Properties Square Feet $154M 98% 8.3 Years 7.5% SLR Leased WALT 66% 85% 1.6% 1.3% 0.8% 1.0% 1.3% Average Annual 0.1% IG Tenants(1) Rent Escal
Slide 20: Single-Tenant Office Overview
SINGLE-TENANT OFFICE OVERVIEW Segment Highlights Lease Maturity Schedule (% of Total SF) 20% 90 8.6M 5.0 Years Weighted Average Lease Term Total Portfolio(1) Properties Square Feet $143M 94% 68% SLR Leased IG Tenants(1) 5.8% 1.7% 93% 70.0% 1.1% 1.3% 1.8% 1.1% 1.1% Average Annual Rent Escalators(1) M
Slide 21: Leadership Overview
LEADERSHIP OVERVIEW Management Board of Directors Michael Weil, Co-Chief Executive Officer Independent Directors Previously served as CEO of The Necessity Retail REIT Member of the Board of Directors of Global Net Lease, Sue Perrotty, Non-Executive Chairperson of the Board of Directors Inc. sinc
Slide 22: Financial Definitions
FINANCIAL DEFINITIONS Non-GAAP Financial Measures This section discusses non-GAAP financial measures we use to evaluate our performance, including Funds from Operations (“FFO”), Core Funds from Operations (“Core FFO”), Adjusted Funds from Operations (“AFFO”), Adjusted Earnings before Interest, Taxes
Slide 23: Financial Definitions
FINANCIAL DEFINITIONS Funds from Operations, Core Funds from Operations and Adjusted Funds from Operations Funds From Operations Due to certain unique operating characteristics of real estate companies, as discussed below, NAREIT, an industry trade group, has promulgated a measure known as FFO, whic
Slide 24: Financial Definitions
FINANCIAL DEFINITIONS Funds from Operations, Core Funds from Operations and Adjusted Funds from Operations (Cont’d) Core Funds From Operations In calculating Core FFO, we start with FFO, then we exclude certain non-core items such as merger, transaction and other costs, settlement costs related to o
Slide 25: Financial Definitions
FINANCIAL DEFINITIONS Funds from Operations, Core Funds from Operations and Adjusted Funds from Operations (Cont’d) Adjusted Funds From Operations (cont’d) In calculating AFFO, we exclude certain expenses which under GAAP are characterized as operating expenses in determining operating net income. A
Slide 26: Financial Definitions
FINANCIAL DEFINITIONS Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, Net Operating Income, and Cash Net Operating Income. We believe that Adjusted EBITDA, which is defined as earnings before interest, taxes, depreciation and amortization adjusted for acquisition, transactio
Slide 27: Financial Definitions
FINANCIAL DEFINITIONS Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, Net Operating Income, and Cash Net Operating Income (Cont’d) Cash NOI is a non-GAAP financial measure that is intended to reflect the performance of our properties. We define Cash NOI as net operating inco
Slide 28: Non-GAAP Reconciliations
NON – GAAP RECONCILIATIONS (Amounts in thousands) Three Months Ended 31-Dec-23 EBITDA: Net loss $(48,578) Depreciation and amortization 98,713 Interest expense 83,575 Income tax expense 5,459 EBITDA 139,169 Impairment charges 2,978 Equity-based compensation 1,058 Merger, transaction and other costs
Slide 29: Non-GAAP Reconciliations
NON – GAAP RECONCILIATIONS (Amounts in thousands) Three Months Ended 31-Dec-23 Funds from operations (FFO): Net loss attributable to common stockholders (in accordance with GAAP) $(59,514) Impairment charges 2,978 Depreciation and amortization 98,713 Loss on disposition of real estate investments 98