EPR - Earnings call transcript Q4 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Hello, and welcome to the EPR Properties Q4 2024 Earnings Call. [Operator Instructions] Also as a reminder, this conference is being recorded today.

If you have any objections, please disconnect at this time. I will now hand the call over to Brian Moriarty, Senior Vice President of Corporate Communications.

Brian Moriarty

Great. Lena. you, Thank us XXXX joining our quarter fourth Thanks call today and year-end earnings webcast. and for for Participants on Mark today's Greg call are Greg Silvers, Vice President CFO. and Vice Zimmerman, Chairman President CIO; Executive and Peterson, and Executive and CEO; terms. believe, you or such I'll this include be, words in Private as call defined other of Act continue, that Securities start will as by Litigation statements may, XXXX, may anticipate call the the comparable expect, informing hope, forward-looking identified intend, by actual and contemplated may such condition company's vary materially forward-looking operations The results of financial the from by those statements. factors cause reports forward-looking company's company's Discussion that of from in filings, materially SEC to on these Form those are the contained could results XX-K the differ and including statements XX-Q.

certain useful of believe supplemental today's Additionally, included Form measures, to non-GAAP most earnings this to call in the are and SEC the reconciliation A which comparable are will these performance. measures directly in release company's the to references measures evaluating X-K. furnished we GAAP information under contain

you supplemental are and today's Investor www.eprkc.com. earnings earnings company's wish release, Center website, presentation on the available along, call to If of page the follow

I'll Greg turn to Silver. the Now call over

Gregory Silvers

year-end Good webcast. today's thank us and morning, fourth Brian. call earnings you joining quarter for you, Thank everyone, and XXXX and on

collections are its supported ample our interest as pleased environment, that when well from the disciplined the expectations. the half delivered Office to macro it both removing while in We above pleased we're performance. grow a to deferred X.X% second when continued XXXX to challenging manner. and in have our by years demonstrated The XXXX ended continue experiential Box for full and demonstrate report year a the out-of-period we portfolio year initial to titles, earnings growth of rent performance strength impact navigating portfolio of resilience Overall,

Office with from master releases to this rent Additionally, We anticipate to defined and of our upside Regal our the expect continued lease. the as sustained as coming benefit grows. this inaugural years year in the in begin activate we revenues as Box number structure in percentage was structure growth wide

Additionally, sector. This by including our is also differentiated whom carding expand remained successful and we & has resilient, TopGolf, saw our by Eat supported anchored we it's gaming, Andrei continue and solid operators, in continued Play other relationship. performance sector indoor which with to

ski solid during half the a season, properties look of our we conditions our to from the Separately, improved benefited first half previous second year, the the ski, versus weather and of forward season.

the cash experiential year, to utilizing portfolio through our of our credit. of limited effectively our our capital-constrained continued we environment line expand during by operating Notwithstanding flow and use

our experiential on other made we reducing assets. those and recycling theater further Additionally, proceeds education investments progress into and

at guidance X.X% not dependent any growth As deliver we that XXXX, the we will through we look approximately sourcing anticipate upon efficient capital, equity midpoint of earnings of an our to forward which is issuance.

X.X% Within disciplined our conservative operate increase sheet this are Lastly, in a to pleased in to us have common allowed context shareholders. the management monthly balance of to we financial environment. current macro approach, strong dividend announce our cash and this successfully

Following flexibility. this will increase, will and covered, remain our we retain significant dividend well financial

to business Zimmerman, cover detail. who the greater in Greg over turn I'll will Now call the

Gregory Zimmerman

to operated, properties we end approximately the XXX of Thanks, XX% intend with Greg. are billion properties our sell. that excluding At the vacant were investments or quarter, $X.X total leased

was the million. in our $XX.X XXX% During spending experiential the investment quarter, was portfolio. our spending of

intend vacant XX% of accounts and sell, of properties for experiential investments portfolio the to approximately billion. Our operators, with or the properties quarter, XX XX% $X.X total or operated. end was XXX And at our leased comprises we the excluding

was sell, the with comprises properties vacant the the excluding XXX% end quarter, and Our at of intend X operators, portfolio XX property leased. to education we

of last to The at Xx, recent XX-month for portfolio Overall slightly is a trailing coverage Trailing coverage from the period. based on at the stabilization schedule remained impact theaters Trailing X.Xx, coverage. strikes. down quarter. from remains the from non-theater on XX-month XX-month strong portfolio down and evidencing X.Xx, portion data Turning quarter. last slightly for was our most release from provided September again, coverage actor the writers

our operating Turning to status the of tenants.

$X.X dissipated, see half XX% QX year. Office. American $X.X Box from a the the up We QX Box of Office continue only to in of XXXX. from billion, recovered significantly severe Box impact XXXX. X% Office strikes Office second the the After release rebound was totaled schedule North billion, Box down XXXX the in on

XX particularly We reflects behind major are Office is X/X releases. generate X growth the releases Box small of Office directly confident the the wide strikes and studio Hollywood released, number releases calendar XXX North titles typically the which around studio Box impact us. current studios, major growth. of from XX for of ties American XXXX, The to the titles

releases there point for major were scheduled the major the studio XXXX. than forecast calendar, because at releases more in $XXX from are The XXXX, million strikes. at major point gross context, in in XX XXXX XX For this studio currently the down studio releases XXXX XXX on this scheduled of to

at start nice Office QX Box with off million. through week is $XXX to a this

to grossed March Captain opened over $XXX the Snow since $XXX and which film QX, XX. New grossed weekend, surprised grossed Day it million, pleasantly In Brave second projected its opening weekend, generating are $XX with the date. best to gross January of million which and million in weekend World, making X $XX President's overall the opens animated grossing titles highest QX which and to are million date; released over [indiscernible], America: strength We White, XXXX on has has

Superman; the XXXX trajectory into in X, Dragon; Your quality quantity Steps; Final continue and First the World How to the Mission slate We upward [indiscernible]. are that Rebirth; Fantastic Jurassic to and Office. XXXX includes and optimistic will for Avatar propel the The slate Reckomy; Box Train Impossible, an of XXXX

between calendar be $X.X to Box We and billion. North year $X.X XXXX Office billion for are estimating American

over Kansas Turning we XXXX. destinations. across revenue, scheduled the from saw in openings now the our customer up portfolio season has operating groups. snowfall Both Carty in an were drive-to across of continue results mid-XXXX Most is trailing periods XXXX. QX and ski our value-oriented pressure other benefited update expenses in same XX-month QX respective and select Schaumburg, Despite portfolio drive good and in sales and early to EBITDARM Andre cases, business. on help City under early major to construction some and with revenue and City, for Oklahoma pass our

at the outfield turf self-fund refreshes lighting, generally replacing TopGolf anticipate we X EPR repainting XXXX, include The In will at properties. updating sign. and and refreshes least

our EBITDARM both Eat pre-COVID the strong While down trailing QX & revenue period and and remains same levels, respective in Play over slightly XX-month were and XXXX. coverage above QX

anniversary. the Bavarian Many In Balcardier water Inn XXXX. XXth of closed our Gloss celebrated in open in season attractions Michigan, its December, hotel will anticipate XXX,XXX were at at indoor square QX. for in foot the Frankenmuth, QX We the the addition park

Pagosa extensive all an past with the laser family opening expansion continues road XXXX. our a a revenue in growth. scheduled of Springs Over the for cream bowling with years, Construction and driven X course tag, spring customer which Springs at the ice have Resort of lanes, added entertainment and shop has center

XX in the saw in the in Across both revenue through increases and period wellness same months EBITDARM we our trailing XXXX fitness and December over XXXX. portfolio,

perform education Our portfolio continues well. to

EBITDARM Our the largely up September through while same increases. by by revenue was operating XX-month customers' decreased trailing cost across period portfolio the X%, over driven X%,

is properties, being managed of consolidated Office our to show expense with Kartrite we're theaters operating revenue seeing by respect offset at our improvement some Box the With improving continue Waterpark. This the and/or performance and to Hotel pressures recovery.

in partners lender for with to our hotels hotels portfolio. identify we eventual in our continue expect this joint hurricanes our QX call, will St. in earnings in significantly our XXXX. good removal damaged We X of a forward and to as result venture And by the from the Beach work faith path noted

the meaningfully to and Louisiana. significant underperformed investment our Margaritaville and infusions QX, RV capital property debt require Additionally, nonrecourse expectations unconsolidated the operations. Resort will exit service made we decision Broadridge, the equity park during to The in in ongoing Camp

the As our partner in reached end joint and interest to we the exit a venture of joint our agreement with assets. result, subsequent venture the to quarter, an the

to Yogi Bear's assets the continue period and Park unconsolidated X XXXX. carrying Stern and in trailing Jelly value interest as QX of in showed revenue have ventures These We same joint Cozy over X RV [indiscernible] XXXX. Jelly Stern that parks, million XX-month of Rest of the total Park hold combined in EBITDARM the end growth $XX a with

course significant are of and increases our with We properties. all operating of of for the part normal the pressures, are tenants. The expense our disappointed insurance, in including volatility of business performance performance

depth isn't However, of worth decided for Accordingly, Fundamentally, net strength terms performance, these we us. given lease pursue longer have juice the in portfolio. will squeeze they no the types of and investments. of our we not are that especially

Hot in we but for QX, to investment diversifies open, projects, Springs New attraction is In $XX.X themed Berland, second Digerland bringing our added our we park outstanding to is end USA million. million not XX further investment East $XXX.X and our West During the in closed, with which million. Resort to in award-winning Jersey, to spending and are XXXX base. Glenwood our the Iron quarter, Colorado, have list properties. total fund of Philadelphia country, the Springs construction Hot water was which XXXX, yet Digerland experiential the Mountain of $XX.X the acquired only IAM, of in miles the Springs, Subsequent tenant

Resort the the Kansas Cardium City, City new also and Greater in We Safari of Illinois. Aerondx funded Andrei Schaumburg, Water locations, X acquired Oklahoma and development

and both target We our build-to-suit acquisition opportunities expansion and high-quality to see redevelopment continue in experiential categories. for

to our cost our investments the operations, million. XXXX on million cash from will in $XXX to availability continue facility. to credit revolving of cash spending to and We're from funds for discipline $XXX investment and of the borrowing primarily proceeds be unsecured range in maintain hand, with those fund issuing we deployed guidance under capital, from Given dispositions

projects closed anticipate XXXX, years. is million in development have be at million million the not We have and committed midpoint funded range. deployed $XXX are be XXXX to the which next $XXX that deployed will our included but We for X of over approximately of yet $XXX experiential guidance the redevelopment approximately

former net a net vacant and a $XXX,XXX. combined gain we $X.X million, vacant former former resulting in theater of sold Xscape proceeds vacant for of a Regal, KinderCare QX, School approximately In a

company proceeds $XX.X $X and the million. sold childhood a disposition Subsequent we million million. quarter, asset of for end of to a XXXX, sale early the For and of net totaled vacant gain gain $X on education million recognized a proceeds $XX.X the net of

today, we assets. of no education have As vacant

$X.X of of Also end of XXXX, and we sold Since subsequent quarter, net sold million. the vacant gain proceeds Regal to have early theater we XX a million another theaters. the for $X.X

have We of have which we which XX sales. sold one after remaining purchase took bankruptcy, we Regal theater months an the Regal executed conclusion for have we theaters the AMC former of back XX XX the and X one one we and in September. bankruptcy. from the closed vacant Cinemark currently have announced, and We former was bankruptcy was theaters. last operating, currently Regal Cinemark manages Regals, former X previously as

bankruptcy, was the first, sell the theaters. Coming once we our managed progress attention theaters. marketing Regals, vacant most the the remaining to intent the disposing Regal it in and actively out trajectory Cinemark significant we vacant made good theaters to Because on to managed selling X turn are our of a of

these and purchase sale of X. signed have agreements for X We

Although be XXXX. in no these half there of first the occur sales we can assurance, anticipate will

no signed locations. addition, anticipate both leases we we half this sell agreement sale the XXXX. sale assurance, Again, occur smaller although to theater purchase X that operator In in there have a be to can currently first of and will properties

are the guidance $XX issuing of million. We to range $XX disposition XXXX in million

actors the our portfolio. and universe our non-theater and these demonstrate was theater the years, past several coverage over our events the important strikes given believe COVID of to the on versus bifurcate to we Finally, events it subsequent of writers impact

our XXXX, we As months removed we is a for return production to calendar normalizing, normal portfolio whole. and the will as XX coverage year strikes reporting on are from film now

In our years, to tenants get addition, several over closely the we have more past timely worked and with reporting. detailed

be education than reporting will the which XX-month quarter. trailing previous coverage of as based the through are end a such, of the we As basis the on component, will other quarter metrics be our

it financials. I turn discussion for of a to the over now Mark

Mark Peterson

the the performance prior per with was in was financial provide $X.XX the Thank the in you, quarter $X.XX Greg. on fourth $X.XX an Today, the our year. adjusted discuss and update I'll compared to year, per for our versus share for introducing guidance. prior sheet balance quarter quarter FFO and the share and XXXX as year, $X.XX for close AFFO

I walk want key through variances, from explain some as the items I FFO and Before to AFFO. adjusted excluded

continued our we reducing proceeds other and make properties and progress experiential During theater into the those recycling assets. quarter, to investments in education

vacant First, education a gain of we X $XXX,XXX net X we center, for million. $X.X theaters net which childhood of totaling and recognized the vacant sale early received on proceeds

$XX.X of million. proceeds gain $XX.X million. For We a on the year, net sales totaled disposition recognized

we Second, sell, properties as the with of X theater leased half in all smaller operating under operator first contracts theater on have well by X properties X a as closings to properties expected theater XXXX.

million these we charges of During related recognized noncash impairment $XX quarter, the to properties.

associated while earnings also sales, with redeployed properties. these the into However, assets, proceeds be in earnings accretive will operating volatility experiential other we that reported to reducing expect once the from

quarter, in the underperformed exit an located Louisiana. The service we decision the to infusion charges value. write nonrecourse ongoing Brokridge, in month. debt during unconsolidated $XX.X finalized we capital and operating required property the Accordingly, million In fully on recognized impairment carrying and would property our RV property quarter, to addition, made this earlier exit joint our RV to our during investment in this ventures the of off have operations. equity investment expectations We

remaining million quarter, the received of we subordinated loss. for provision sale our during $X for as $XX.X note credit million also on in receivable We property. recognized the exchange Accordingly, the mortgage

total joint of value RV million $XX in X We a operating year-end. at with unconsolidated properties ventures continue to X carrying have hold that interest remaining

quarter year. the positive million prior revenue rental deferral in moving revenue the to $XXX.X total million Within investment $XXX,XXX offset year. was fee the key was Now the customers variances. versus for prior Total $XXX The versus termination by and year. out-of-period due cash basis of recognized collections prior the million revenue, impact increased a in $X.X from million to decrease $X.X lease during spending a

past relate attraction percentage and rent well revenue, rent due and the the million period early recognized percentage from rents additional as in we were and operating over Within due income were expense as the Please that $X.X consolidated was period primarily X properties, decrease current and third prior of have investments to sold the versus lower during X year. we as million prior to the tenant rental certain for properties. from cultural plan our in that and versus Kartrite less income $X.X theaters properties including operating mortgage quarter year. hotel our note theaters water during The of mortgage in financing notes million that Both one theaters. in the other the X other to quarter increase to operating was from sell. closed the indoor park gaming our we the year other $X.X The percentage during current in the year 'XX of operating

earlier, contracts remaining theater I under for the sale. also we As X are we operating properties of currently mentioned have X

decrease fees. expense professional On million prior expense credit payroll for facility $XX.X the from primarily lastly, off-season joint lower as in G&A of our income prior well million $XXX,XXX in prior by including losses the share-based million short-term under due as the to increased and $XX.X unsecured year, to for interest a net quarter for ventures noncash on about Florida, quarter to expense the Louisiana, decreased to by due well in compared as properties as adjusted expense the in quarter increase expense year And costs, year as compensation Interest investments to investments. borrowings the FFO as side, due lower the hotel decision increased from versus last the well Pete discussed revolving $X.X earlier. St. in Beach, as discussed avoidance in as an primarily to interest versus X investment JV joint I quarter, Brobridge, venture exit the

increases the interest and ventures. offset expenses, at These by were remaining partially joint FFO insurance higher including in

AFFO year per in $X.XX $X.XX in compared versus year, year. adjusted full the the prior was to and to share $X.XX per results. prior Shifting FFO was as share $X.XX

would per $XX.X illustrate out-of-period FFO impact as slide, XXXX collections and deferral the of thought be next or to basis you of in XXXX million $X.X impact million it share or the remove per On of on the adjusted XXXX for helpful cash from I when $X.XX share per growth from share. $X.XX

XXXX deferral as without to per from was As adjusted you on FFO the XXXX collections X.X%. see growth can slide, share

Turning to company's ratios. I'll credit the next of review the slide, key some

at coverage interest continue coverage with both As and charge X.Xx. you see, coverage ratios to and service be X.Xx, our strong fixed can debt at

Our X.Xx for the was EBITDAre net adjusted to quarter. debt

the as If at percentage other you X.Xx acquired low of quarter participating this which to rent of well include at of our adjust and end, the and of or in service annualization range. as this quarter targeted ratio the annualization disposed the ratio investments end during is put interest items, was

a assets continues Additionally, XX% of both payout year-end, covered book AFFO XX%, year. our an dividend be quarter full at with basis gross our well debt net on and common to the ratio for was and very fourth to

fixed great had sheet, debt move is balance or At an is blended $X.X year-end, through rate coupon Now that billion of we consolidated approximately debt let's $X.X debt billion, either to swaps, fixed in with our which of which of interest overall X.X%. has shape. rate been

$XXX only debt Additionally, maturing we million year. of have this

our see, maturity. billion million of debt year-end million us our the to approach positions our $XX.X cash us well forward, on $X remains on $XXX liquidity upcoming and in can going new and million hand which position you great at revolver, drawn $XXX with As strong flexibility only refinancing provides

well an the for $X.XX, the year guidance $X.XX share. of which XXXX our off-season fact midpoint. for the our full first last over XXXX as the the by properties, per we adjusted lower are prior operating by to quarters of percentage share Note weighted X.X% quarter year, rents, as at per year to the that of than that as to We the of of results X expect $X.XX X FFO representing about quarter due is primarily first are be divided the increase timing expected introducing to the heavily

have we we limiting are investment previously, our cost of As capital, discussed our near-term spending. given

to million our of We investment million. XXXX are providing $XXX guidance spending $XXX

for disposition million providing are of guidance We for $XX also million. proceeds to $XX XXXX

of percentage guidance percentage to million of increase the breakpoint $XX to certain by subject an midpoint rents the This offset rents is and rents for interest $X million. and rent primarily participating properties over We expected prior $XX is versus The of from go year. base expect increase related to in this master reflects the that up. have percentage increases Regal causing theaters lease, XXXX, million to

including lesser increase of expense from and members. a guidance We a taxes $XX an amortization, refund in expect million. and in additional this Board prior to primarily midpoint noncash an costs an XXXX of grant G&A in about year The received stock $X.X million. degree, of to increase benefit This increase franchise and reflects $XX to of million due is to increase with costs, payroll due associated adding

Guidance expected to be providing properties $XX supplemental. be our no are million, a is only our for found on next slide, operating XX forward the other provided On operating longer details our by going and expense. and the remaining for guidance we consolidated Page in of FFO Since JVs JVs. our range can is investments giving other income nominal, for impact is guidance

shareholders of the in X.X% with XXXX announce XX expected our we record of as a are to monthly on XX. pleased payable performance, March based Finally, our April dividend to beginning dividend, increase

be dividend covered XXXX be to on AFFO about of share payout our to at continuing per an expect with XX% the midpoint based We well guidance.

that, I'll turn Now for Greg to back over with it closing his remarks.

Gregory Silvers

Mark. you, Thank

us demonstrate thank all about more Box to start, normalized off and Our of are delivered the our a experiential we I for are contributions excited XXXX. for XXXX results solid and about results, to strong we partners challenges, tenants, offerings. to continue in release the in excited want we their demand Office beyond. and many associates before schedule. consumer a opportunities Facing With

With that, up for Lela? questions. why it don't I open

Operator

come Scott. will with Rob Our Stevenson first Montgomery Janney question from

Robert Stevenson

are How the RV performing the you versus remaining one that exited? Louisiana X parks

Gregory Silvers

-- think I jump also also Greg in. But Greg let better I'll we're Again, Zimmerman jump seeing performance.

and And kind been just not if have conversion the look Margaritaville go and property. work but established. that. of did again, decision. was we offerings. others have -- back didn't the would the at branding of We the of I change we look really Beabridge, the Greg? not think, say more expanded It for We But that that right

Gregory Zimmerman

around construction of both Rest, things think under products, I for which have that's jellysam number a long time. been On been a Cozy years. have Rob. of for right, a that They're we have couple

yet. So we're really normalized not

We with expect last we amenities. the to a online come of cabins had of some added along that this number year year,

So we're feeling better about those performances.

Gregory Silvers

Yes.

As those comments, And my X I the is contribution up be normalizing. Greg kind of and is and nominal. well. we running doing to said, as 'XX the go-forward for from one, The said in other one expect

was FFO it service from in this trajectory. overall, full that it's interest should But has good of year, burden, a point certainly number nominal expense be view. on an pretty a So put but

Robert Stevenson

of in? sort sort of a that Or you like to you're park, other future about thinking lodging some Okay. you a water for are helpful. still likely Hot Springs the terms in forward significant investment is and interested to type attached And that that investments, aren't how that of the then something not assets guys? other be assets That's going of is

Gregory Silvers

operating versus this is like I should of, we income in don't fixed lease think about What No. net or not terms space, we Rob, that think the structures. fact but that like don't you

a of Again, it on we insurance with Margaritaville doing have pointed is is can likewise, of squeeze. value, whether as RV something a these of, being well. be investors partner is something a result -- experienced the introduced said, worth like we [indiscernible] in where I operating I Greg leasing not us lease that's to as be the Park a net the it the out, some nor that think very situation others, cost we candidly, So isn't what and juice that's have volatility or

again, still of but environment. some like them net like kind our we lease we So of in sectors, these

Gregory Zimmerman

also And then Springs mentioned Resorts. you had Hot

We are very on bullish the Springs area. Hot

one in leading in I really investors of the would that. there overall but a and And the it's plays so to of we're the the attraction, think don't well. do ability country pure day includes say lodging we lodging a is part component pass of I which those, view those as

Robert Stevenson

Okay. And strong of then you the best beyond opportunities are where improved today? the your and seeing your sheet development pipeline, investment given equity cost balance

Gregory Silvers

really Well, we're verticals again, portfolio, think we're great And Iron year. able Mountain to almost our space. a right acquire now. on have I again, we fitness And we're the in and mentioned of to opportunities Digerland were in QX. good very including attraction seeing last proud seeing We're traction all in bullish wellness. added good we just I

seeing lot very our still being just we're a cost So given and opportunities. careful of capital, of we're

Gregory Zimmerman

And just doing & locations, Eat that's to we've got the in add the carding area, and Play that X we're new performing Andretti well. to that,

Operator

question Anthony next from come with Our Paolone JPMorgan. will

Anthony Paolone

of And along to maybe Rob's some the questioning continue lines. just with

it of at look committed we what pretty you've A you set. growth with seems if capital if look deployment sales. at that's your net -- competitive of the even already of lot with your rate the bag, your to. the midpoint in guidance, Your peer is And

to interested do yields guess be to just in kind areas you for of And the interesting. like So I history? deal does I deploying get talked right look to now you how flow need But relative guess about what most more? are where

Gregory Silvers

we consistent the there's -- we to think mean X is cost asset capital. end -- balance us when flow -- don't the I for kind happen? just think I maybe get I investment-grade think sheet more you where deal our is Again, Yes. be standards about to where think could excited to it And range that. depending is opportunity on maintaining these of of to balance we of needs of pretty conscious But different there. upon depth the margin, our say raise us sales Mark, the kind of to some of have... higher [indiscernible]. fortress would I We get and capital our of need do that our we're would But sheet. I set allow equity

Mark Peterson

Yes.

equity our of has substantially come and cost cost recently, continues debt come On quite down the our cost down. both capital to side,

kind We'd the basis if multiple at basis a we're of your right the low do to least of capital. you of XXX approach So or XXX equity points XX-XX and cost debt Xs see in like in relationship, now, spread. points

but quite do the direction. we're not year, we're and So here we there year it's certainly about for to that to did yet XXX talking moving this in ] incremental over [ what XXX next the right

Anthony Paolone

other how pack operating the one that with sizable Okay. the think because done with long-term you've most And I options then mean, I just do the some about think, is, and from of my the But exit of still second ones. one on the [indiscernible]. I what it appreciate you there?

Gregory Silvers

Again, numerous entered it's the point and quite we an the it's to had we last have overall that been we activate combined And those into remember the doing challenge. challenges Yes, Tony, again, we're year, we've shut balcony basis, year, transaction basis, down gaming. needs to lease and look that something again, step or Yes, we at on that up on will at some allow to on that, the definitely every of asset. look continue we but whether to operating in and would like future, of ground we'll Its performance explore. out get at to the to, that. well of a

Operator

come will from line of from Citi. question the Next Rose Smedes

Bennett Rose

percentage the ask the Box end continued Box a you is in the really on to kind else rents, in out? a dependent achieve there is to factor? of Or that of expected just could those guess, wanted numbers mentioned, But there improvement drive you the higher I you something just Office. range, that Office I help

Mark Peterson

performance percentage I of number rents different properties. there's across a mean -- the

that driving is properties, any $XX box could have percentage higher of the to range, -- that in million is you So to only probably Regal our end million. the range but $XX significant most which outperformance to office probably number is get theater only

maybe we're more the end. So at high $X talking million about

Gregory Silvers

I end of to getting Smedes, just think things that again, all the think investment, earnings of also, like range. factor of get higher additional the about of end to all higher the investment, when range us, we in those to of timing

to So so there's think better in of the better lot drive some the that factors operating contributing there's could I performance a us -- of than midpoint.

where our Office think on best that. think And consistent I range midpoint the come expectations I at our given will in. Box with is market we've the stated

Bennett Rose

for And the expect then exit properties, Jellystone -- -- overall. and from would mentioned? Bear remaining JV But they're, X to you that guess, Yogi you realize properties would I relatively those, that the you small are I you

Gregory Silvers

see just they to contribute. we're on a going Again, to have value relative on what

the we'll net time. said, an insignificant. take that fine. to don't it's into a is we you opportunity investment, look owning lease but and term, relatively redeploy If over think committed performing we're I at they're that get that for -- a I'm to exit long As contribution more them it's necessarily their such sure

Operator

UBS. line question Michael next will of with Our from come Goldsmith the

Michael Goldsmith

the you're First loss of what assuming that prior year around how that question maybe some compares thought credit years? for outline and the is just for you process to just can and

Mark Peterson

Yes.

booked for GAAP. credit start mortgages. the model loss through mortgages on Credit loss Let's is with

I'd about overall, $X say about booked So of it's probably ongoing EBITDA, on that's million. an is X% which kind basis. of

bad cushion that So think, of got, in of for about I kind amount debts. we've baked

Gregory Silvers

consistent do what that's And every year. with we

Michael Goldsmith

also then the got just XXXX the debt have revolver, it. mentioned You've also Got then bit of kind you follow-up of room little maturities but you a $XXX how on question is a million. funding of And on right? XXXX investments,

little talk debt you a the you can how on on maybe like not quite So funding there issuing bit sounds just about equity. you're it well? plan on And as

of just you about those X. talk So the interplay

Mark Peterson

Sure. Yes.

got $XXX we've And through investment the And free sources of flow got million, $XXX roughly. of have $XXX the the Let spending million me at we sources uses. on just a $XX so on midpoint, million for and run at maturity about million. of million loan you and dispositions like the uses cash uses side, we've midpoint $XXX At side. the said,

sources. of million $XXX it's So

So that your $XXX didn't by line that financing, would -- do if long-term any about you million. increase

-- half on add about would $XXX to the at we So that the about line. we'd million be be that drawn year-end, we're

-- got million bond or way which is do what our line ultimately deal, and would it a million. and that $XXX down term that in more under take we a bond, call it, which we to -- $XXX do we've out have So could our would, plan to

could we of that our out. flexibility ultimately the point whole is think fund or thing laddering we've be I flexibility. fact that drawn. course on we of line X-year that, So But only term half of the the is our intention have respect and room And given our a I got Also, a in lot to we've a think a XX-year. got with for X-year, to

got a do right of of I to market bond determine a the deal. watch potentially flexibility we've time think to kind So lot the and

Operator

of line Capital the from come will question Markets. Michael next Carroll with Our RBC

Michael Carroll

you be touch percentage rents is that versus break were to guess percentage rents largely Mark, rents on X how highlighting. kind kind between 'XX? of theater stable I to does years? out guess, the that do you the what rents? percentage versus 'XX non-theater the specifically of want I I back And non-theater can the expect change in percentage you guys

Mark Peterson

Yes, cases, rent there of out. puts the some part we've mean and the bump. large increase break in rest the some of And is we the I master properties, is takes. lease. a got the Regal that don't But

So then the shifts increase side, But fairly box down getting just stable of from then, Regal on but course, income the the rent go statement. and you for the have and percent location the but year-over-year, overall, you're office. the slightly, caps, rent might on it

Michael Carroll

related then July and included the box Regal And office guidance know Okay. in you that, to us provide lease, what's that for a XXXX. in ends lease year I guidance,

the does Office differ the full expectation? Office year lease guidance XXXX meaningfully Regal Box from So year too Box

Mark Peterson

a you when look say, July. that to meaningfully at would I July No, not different Michael, it's

the If -- second started the we Office about you in look the Box last half. acceleration remember talking year, of

a fairly And are rate those so basis, run on consistent.

Michael Carroll

then the is how know it's you assuming just I largely at other I those And Tony talking look are if Great. this. you're you're properties know clarification -- guidance, like looks 'XX. about How Okay. between performing? flat and one Cartright. on income or it to 'XX

is of assume do it you conservative for estimate? kind that And that's where your through right So Cartright it a stays should is XXXX? expectation now we think

Gregory Silvers

this is Again, we performance, the here like I insurance operating in year. better think thing what slammed with that, costs we talk get again, when we properties. Even get did we

progress. and climb difficult of very it's continued kind So make to out

I it we we're fashion So the keeping in that have. think

on anticipated. started challenges -- to said progress running we it's I had of a It's earlier, getting than Operating the nature. balconies, expenses of multitude continue to significantly work shutdown, that. that with We make things are higher as

that. So work through continue we to

Mark Peterson

other out. both numbers, we down one X theaters Yes. the and overall, are could timing and thing operating coming I'd but say of to income expense, X that these those sell obviously, other as that's point affect

expect improve the kind being thing said, side, Kartrite of, as the second on pressures operate But expense of it's given, do in expense Greg of The that we year, do like to performance particularly some theaters is, Office offset this improvement. the we Box insurance. by the kind

that's breakeven we of a breakeven sort midpoint of kind scenario. So at the why guided net

Operator

KeyBanc Capital will question Upal Rana from Markets. of next the Our line come with

Upal Rana

guys you it that in more is theater ahead the 'XX something your into second just will Or Because that in movies? XQ continue beyond? stronger else that even movie it business? do drove and came think Was earnings. of projection half during gave What the you it you think

Gregory Silvers

jump Greg I'll let Again, in. and

to as titles, going more when into titles. number normalized of think And always to got the we've back quantum have fundamentally, you the of I the kind of the movies. a and said, habit consumer matters, gets of titles we

that, -- kind think it we feeds again, So of that itself.

that into But so the Greg? movies 'XX And more get tone enough beyond. people and to into think tenor of carry will we and habit,

Gregory Zimmerman

it. covers that No,

Upal Rana

Okay. notes mortgage $XXX on JVs, of are that given and acquisitions, you towards investment how either And of development, guidance allocating the million mortgages? half provided, $XXX Great. volumes across were then million you capital planning to was helpful. your That investment almost in 'XX,

Gregory Silvers

Yes.

In I up I generally it deals say target ends us. art, As the we XX-XX. it's general, that, an it We time, come how that a the usually can't do to about being try before science. but comes not say that's out. all best

[indiscernible] we've finishing a And we're including deals. up already then development the of acquired obviously, Now was which Dgerland, couple we projects, mentioned an acquisition.

Gregory Zimmerman

distinction. I draw our ownership. to do think important though a we it's Most lead mortgages of that

investing forward you historic we again, may it to outside ours mortgages. or a things where a that these that of are that's And it's of So aren't path what we credits ownership. convert structure, a structure can't we get nature. the have most these tax until of year most investments saw that long-term are mortgage and last period But There are.

Gregory Silvers

short-term mezzanine. Not

Gregory Zimmerman

Yes.

Operator

the of Bank [indiscernible] from comes with question next America. Our line of

Unknown Analyst

a lot could of of traction the And around Box of with the of talk to rate to cap the and sales, depth there. that? non-vacant buyers I hoping and kind theater and had pivot dispositions. success improves breadth You've you was expectations asset Office you out any as kind

Gregory Silvers

So thanks.

at mean deals. team. out shout fantastic my they're First to to of the to I source I these just all, got ability

as theaters, vacant We real For them just we're estate. agnostic. market

not yet. properties leased we we theater one We of able about I a the recovers, that these I going better say there pleased box to the think the yet. for have to we're we're mention do execute. visibility we're starting rate happen. cap on be and lot real X%. Again, to subject contract, mentioned, closing more better that. to transaction would estate, as on right, will of in seeing office come the with It's that you're trades So that's transactions really But the hasn't under probably did as closed the

Unknown Analyst

do from Have see with of kind of directly Great. kind the peak of what And terms already you the the then just Or we expenses? -- think are kind pressures? wildcards lap you've still of you in we we experienced do conversations kind and expense in will where tenants operating with of properties, some insurance?

Gregory Silvers

it wildfires talking a of didn't the that, we kind to insurance commercial of a just function said to be what meeting occurred. had again, what I think seems were fortunately, California out. topping see I people that with events hit where insurance be we're mean going properties. is we -- the again, I starting mean, that's yesterday Again, many to -- who

properties, that to kind we've the going of I hard through over again, too. the It's That's handle get facing So still what flow XX%, of last on But reinsurance tenants X issues. we've your are seen were hopefully, it. will XX%, kind our peak not our of -- say to seen that's And that, on of see the a the impacts one but just XX% kind operating challenge. didn't it's it. just peak, XX%, that. we're back years,

said, driven is through seen But slight [indiscernible] tick where again, those is down what but by far we we've they're as that. pre-pandemic. we so which I expenses, were managing than saw, of higher in we mean still considerably of really a kind coverage, kind

they're through So I but it's its not challenges. managing it, without think

Operator

Truist. And Kim final Ki come line with of from Bin our the will question

hear you, remarks. Silver closing to able Bin, not we're Unfortunately, Ki pass Greg for so we'll to

Gregory Silvers

it. remainder solid look another thank of the talking greatly to look your Thank to today. attention of appreciate We year. time you. and you and for balance year forward you, Leila, to you, everyone, We through the Thank and forward the

Mark Peterson

Thanks.

Operator

QX call. Properties EPR XXXX Call. joining today's This for you Thank concludes Earnings

now disconnect. You may

EPR Properties (EPR) 27 Feb 252024 Q4 Earnings call transcript