Four Corners Property Trust, Inc. · NYSE:FCPT
Four Corners Property Trust — Investor Presentation (November 2017)
29 slides from Four Corners Property Trust's investor presentation, Nov 13, 2017
Slide 1: Four Corners Property Trust Investor Presentation November 2017
| FCPT | NOVEMBER 20171 INVESTOR PRESENTATION | NOVEMBER 2017 w ww.fcpt .com FOUR CORNERS PROPERTY TRUST N YS E: FC PT
Slide 2: Forward Looking Statements and Disclaimers
| FCPT | NOVEMBER 20172 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
Slide 3: Agenda
| FCPT | NOVEMBER 20173 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 | NOVEMBER 20174 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 | NOVEMBER 20175 OVERVIEW OF FCPT Four Corners Property Trust (“FCPT”) is an investment grade rated REIT (Fitch: BBB-) primarily engaged in the ownership, acquisition, and leasing of restaurant properties 508 properties, diversified by geography and brand, 414 of which are leased to Darde
Slide 6: 2017 Accomplishments
| FCPT | NOVEMBER 20176 2017 ACCOMPLISHMENTS • Announced an increase in the annual dividend to $1.10 per share (over 13% increase from prior dividend) • “Active” acquisitions & portfolio management in 2017 - $94 million of acquisitions year to date comprising 40 restaurants at a weighted average ini
Slide 7: Case Study: FCPT and Washington Prime
| FCPT | NOVEMBER 20177 CASE STUDY: FCPT AND WASHINGTON PRIME Transaction Description • On September 20, 2017, FCPT announced the acquisition of 41 restaurant properties from Washington Prime Group (“WPG”) for a purchase price of approximately $67mm in cash (~6.7% cap rate) with a weighted average r
Slide 8: FCPT Closed Acquisitions
| FCPT | NOVEMBER 20178 FCPT CLOSED ACQUISIT IONS FCPT Closed 2016 / 2017 YTD Acquisitions Note: Figures updated as of 11/09/2017. Tenant Location # of Properties Operator / Guarantor Information Purchase Price ($mm) Initial Cash Yield Term (yrs) Announced Pizza Hut IL, IN 6 40-unit sub. of 150-unit
Slide 9: FCPT Closed Dispositions
| FCPT | NOVEMBER 20179 FCPT CLOSED DISPOSITIONS FCPT Closed 2016 / 2017 YTD Dispositions Note: Figures updated as of 9/30/2017. 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
Slide 10: National Footprint with Increasing Brand Diversification
| FCPT | NOVEMBER 201710 __________________________ Note: Map and figures updated as of 9/30/2017; Excludes six owned or ground leased properties that comprise the LongHorn San Antonio Business, which are operated by a taxable REIT subsidiary (“TRS”). (1) Current scheduled minimum contractual rent a
Slide 11: Agenda
| FCPT | NOVEMBER 201711 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 | NOVEMBER 201712 HIGH QUALITY PORTFOLIO Properties: • 508 properties • 89% Investment grade tenancy • 22 brands – 13 Quick Service / Fast Casual, 9 Casual / Family / Fine Dining Geography: • 44 states • Only Florida (11.1%) and Texas (10.9%) are above 10% of NOI Term Remaining: • 13.2 years
Slide 13: Portfolio Diversification
| FCPT | NOVEMBER 201713 18% 104 units 4% 13 units 11% 94 units 67% 297 units 74% 20% 6% PORTFOLIO DIVERSIFICATION ___________________________ 1. Current scheduled minimum contractual rent as of 9/30/2017. Excludes the Red Lobster portfolio closed on 11/2/2017. Brand Breakdown by ABR Initial Portfol
Slide 14: Lease Maturity Schedule
| FCPT | NOVEMBER 201714 LEASE MATURITY SCHEDULE ___________________________ 1. Current scheduled minimum contractual rent as of 9/30/2017. Excludes the Red Lobster portfolio closed on 11/2/2017. Note: Excludes renewal options. 0.0% 0.0% 0.0% 0.1% 0.1% 0.1% 0.2% 0.0% 0.1% 0.2% 15.3% 16.2% 14.3% 14.0
Slide 15: Rent Coverage and Investment Grade Tenancy vs Peers
| FCPT | NOVEMBER 201715 N/A N/A 2.5x 2.7x 2.7x 3.8x 4.7x ADC VEREIT Spirit STORE Realty National Retail FCPT 57% 64% 80% 84% 99% 100% 100% STOR VER O SRC ADC NNN FCPT 23% 26% 37% 40% 45% 46% 89% STOR NNN SRC VER ADC O FCPT ___________________________ Sources: FCPT and peer data from Company filings
Slide 16: Agenda
| FCPT | NOVEMBER 201716 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 | NOVEMBER 201717 BUSINESS PLAN AND DIVERSIFICATION 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 invest
Slide 18: FCPT Acquisition Philosophy and Underwriting Criteria
| FCPT | NOVEMBER 201718 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 t
Slide 19: Conceptual Underwriting Strike Zone
| FCPT | NOVEMBER 201719 0 1 2 3 4 5 6 7 8 9 10 Screened / Passed Closed, Under Contract, Negotiating LOI “Ted Williams 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.
Slide 20: Vast Addressable Market Within Restaurant Industry Subsectors
| FCPT | NOVEMBER 201720 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 Serv
Slide 21: Industry Benchmarking
| FCPT | NOVEMBER 201721 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. % of % of Predominately Top 5 $bn Dining Restaurant Free-standing Top 5 Brands by Mar
Slide 22: Food & Beverage Seems Most Resilient to E-Commerce
| FCPT | NOVEMBER 201722 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 &
Slide 23: Rapid Franchisee Consolidation Within Restaurant Industry
| FCPT | NOVEMBER 201723 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
Slide 24: Thoughtful Brand Selection Aimed at Protecting Cash Flow
| FCPT | NOVEMBER 201724 THOUGHTFUL BRAND SELECTION AIMED AT PROTECTING CASH FLOW $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 0 5 10 15 20 25 Average Unit Sales Volume ($000s) FCPT pursues properties within the median range of Casual Dining, Fast Casual and Quick Service; Concepts with mid-level sa
Slide 25: Agenda
| FCPT | NOVEMBER 201725 AGENDA Company Overview and Update Page 3 Diversification and Acquisition Strategy Page 16 Financial Update & Key Credit Strengths Page 25 Key Investment Highlights Page 11
Slide 26: Current Capitalization and Trading Metrics
| FCPT | NOVEMBER 201726 Current Capitalization Current Trading Metrics ($mm, except per share) Current Cash NOI ($mm) 2 $105.3 Share price (11/9/2017) $26.09 Implied Cap Rate 5.1% Shares and OP units outstanding 61.6 Consensus AFFO per share (12 month forward) $1.29 Equity value $1,607 Price / AFFO
Slide 27: FCPT Debt Maturity Schedule
| FCPT | NOVEMBER 201727 FCPT DEBT MATURITY SCHEDULE ___________________________ Figures as of 09/30/2017. Current Debt Maturity Schedule1 $0 $0 $0 $0 $250 $400 $0 $50 $0 $0 $75 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Unsecured Notes Undrawn Revolver Capacity Drawn Revolver Unsecured
Slide 28: Key Investment Highlights
| FCPT | NOVEMBER 201728 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 liq
Slide 29: Four Corners Property Trust
| FCPT | NOVEMBER 201729 FOUR CORNERS PROPERTY TRUST N YS E: FC PT
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