STOR - Earnings call transcript Q4 2021

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

Operator

Hello. Good day, and welcome to the STORE Capital's Fourth Quarter and Full Year 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded. I'd now like to turn the conference over to Mrs. for Relations Investor McGrath, STORE Capital. Megan ahead, go ma'am. Please Thank you.

Megan McGrath

with our you joining fourth and presentation Sherry us you, Management; We and operator, to reenter after In we be for the thank and Q&A questions. up issued Craig we results. yesterday, financial of Participants Capital's for hour, Thank of keeping and and to Officer; call. the during Barnett, will while On today Quarterly ir.storecapital.com at your have the under Chief Executive market limit quarterly then and EVP Results, include which participation call queue Portfolio order Maertz, all discuss year to call. today's are in remarks, website These and supplemental information President portion our Acquisitions. an the of XXXX our available release closed call follow-up questions. earnings I'm Underwriting maximize Mary here and Officer full investor of the observing today the will then Results. documents STORE; Chief for if Investor Tyler Fedewa, quarter management two-question Rexroad, Relations today's section open EVP STORE you a Financial will call, can of prepared News provide

statements include we securities Before that you laws. begin, I would under federal forward-looking remind comments will like today's to

per believe, are about share other AFFO expect, are Forward-looking statements not or intend, statements dispositions such are Statements identified facts forward-looking as statements. XXXX acquisitions, for our or anticipate be, such by words also will, historical and words guidance comparable expected as our phrases. that

Officer. forward-looking factors operations by I Mary, of Fedewa, With forward-looking such statements. materially the in those these our Executive our differ statements actual from the condition Form cause XX-K ahead. vary STORE's to are call please over Mary our to that, contained Our may filings, could reports including turn to Form from and like Chief would results of materially XX-Q. on Discussion and financial SEC results go that contemplated now

Mary Fedewa

Welcome, joining will you fourth the the an results for Megan. guidance you, management an XXXX today. made Craig activities, additions review performance. update overview portfolio Good begin will morning, everyone. we call financial Thank on portfolio and our I'll our and with year-end of provide our XXXX. quarter for the thank then and and us and our Sherry to

questions. Following our prepared the we remarks, call to will open up

the quarterly very momentum off to you quarter, fourth read We delivering press release, strong XXXX. through As in AFFO build our with year $X.XX continued of per our a capped history. the share, in highest

increase was the For guidance by the a XXXX, $X.XX high per $X.XX. XX% exceeded share, full year, end AFFO of from or million our $XXX which

for to weighted at look growing demand in STORE Over volume the acquisition course lease many of our million of fourth returned mode fund an quarter business to of growth average and owners rate resulted growth M&A a initial of customized their to financing organic solutions annual $XXX and XXXX, X.X% cap escalations and opportunities. X.X%. This strong

quarter the over well healthy also for spread remained investment Our at X%.

remarks, exceptionally color continues moment. provide and also the a to and and continue perform our will the same property COVID in at profit well. cost quarter second portfolio $X.X the costs. on mentioned expected half tailwinds earnings For these materialized call both full fourth X.X%. Craig Craig we of center our to of the of positive quarter, will share improve trends portfolio and paybacks billion tailwinds in year, XXXX deferral we rate about and at more Sherry We overall our Both in more of invested on cap in we average our to efficiency estate these structure, related the time, that an real their back lower in

fundaments in effective the and want strong environment. XXXX. to touch are into that on I macro now and Our carry we XXXX, strength remained

inflation we has rate are XXXX, anticipating rates is it compressing. while As cap environment, know, are the rising been a highest all a since interest result, and we as

a in our not REITs property-related start inflation business. of expenses. do thoughts Let's Triple couple on lease with operating incur net generally

Our to escalations current us meant well period. are to inflationary in hedge, natural provide contractual manage rent a allowing the

of drive has up addition, the In real estate inflation potential our to the portfolio. value

an in available million in about access the rates STORE between tranches an unsecured As $X of have four and significant it savings that two rates X%. interest environment. which long-term have currently have finally, have of X% and these can have debt Therefore, where And million rising we our interest cost rate we single-A master over AAA weighted we have funding rate realize and existing access prepay And to the includes rising S&P; years we result three which at the current in rate has notes fixed to maturity average are to seven interest years. from annually. an has our XXXX that flexibility, reduction funding completed in outlook embedded a and in over before flexibility anticipated that public interest Refinancing we even would master in and with bond with XXXX, paper; BBB $XXX environment, relates both positive maturity issuances anticipated financial penalty. a to market, a tranches rating to program, prepay without

Now rates. we turning rates. to In in experienced the further our cap cap initial quarter, compression fourth

of believe source model opportunities relationship-based enables bidding are directly broadly us However, auctions, to are to not subject tenants with wars. increased we and business that where marketed we our seeing levels

rising raise new environment. which to to flexibility can potential a us investment interest individually gives approach mitigate raise, rate leased with the each price Our

up a an built approach, our around on from consistently cap volume interest that approach well. our have strategy vital requires a is rate environment give since conclude process inception, we advantage a in niche been or To efficiently in investment million. industries each direct increasing transaction. years has STORE over the to as our competition our direct coming large the the granular addition rates, lane past granular $XX on leg infrastructure infrastructure In in into new doing average and of of and transactions this size our origination an rising solid deal creating an market sector. a anticipated a capital This with to us XX any

a result, As and any we are in returns STORE almost to environment. generate strong confident continue

In fact, our now, ever. more and to the in markets over partnership I'll create capital need our And periods turn and customers for the STORE of than financing uncertainty as solutions complexity opportunities unique call Craig. can

Craig Barnett

manufacturing fourth fourth continue quarter, activities we to a Thank range wide diverse to you, and industries, years a average service, our In markets. what size businesses serve cover added granular including of our of of of for and portfolio our quarter. be restaurants, Mary. vital clubs end under the deal acquisitions and the average that health auto investments early several a variety I'll $XX minutes and an term few had million. XX to a These portfolio take spanning child education, lease management weighted

existing the increasingly solid our about X/X competitive of historical was above marketplace. customers over from relationships provide XX%, foundation The have decade our is which our established in a average we strong past an business New investments. of about

a mix XX% attractive in service-oriented was returns Now service in diverse turning of to and that our in and sector, risk-adjusted portfolio to At retail. to deliver overall XX% the We've shareholders. built end manufacturing XXXX, consistent portfolio. intentionally portfolio is XX% designed the the our

representing rent rent of and interest. Our in in is represent XX rent interest. X% XX% our largest in interest, for base portfolio top of X,XXX annual base national no XX% XXX customer that XX than than comprised consists more only top properties our with There base and approximately industries. our and our change less customers than XXX and portfolio the of and individually account of regional was customers, customers X% More operating businesses of of

over During original our proceeds of XX XX strategically of were for the or XX% The of quarter, activities, sold cap nine $XX X.X% in property management investment we rate. garnering sold part a million. gain ongoing which sold a $XX properties were at properties, as remaining our proceeds million

and continues our to portfolio to remains remain financial strong, high Our Overall, well. at occupancy continues XX.X%. performance our customers' perform

by the improvement unit customers service robust line experiencing for sectors, received. increase improved pre-COVID with X.Xx being to financials is a weighted growth Our of improvement felt across average our are for X.Xx sector recent is demonstrated the This this XX-basis-point And from profitability. our most four-wall SEC our portfolio the top experiencing and X.Xx. in all to

our XX-basis-point pandemic portfolio to Our through thrive had X.Xx. of global X.Xx manufacturing demonstrates beyond increase XX-basis-point to increase and This a a ability sector strength it. the to had its and an retail service-oriented

discussing and in recently, labor macro their customers with a Our our the and financials we We and regular them. basis their chain of regarding relationships with disruptions. on Most deep including environment, businesses. communicate been supply our have from monitoring performance confidence them inflation, stems the

in adapted and various industry. have respond to creative to their the customers impacts ways on Our specific

with staff them augmented make have customers technology Some more to productive.

Some invested terms automation in hedging others chain change labor, mitigate to reduce and pricing have to physical to instituted risk. strategies have supply

of now in to has higher seen national businesses, group As the were and with operating diverse mirrored raise corporations portfolio highs costs, saw regional Though in on underwriting prices like been no attention are in corporations experiences our near attributed and a U.S. strong portfolio able the what customers their our we an place by XXXX. is to and profits record faced performance the our Sherry. directly of effort The to turn We basis. of and the I over to validating ongoing validating XXXX. tenants would on accident. on call creditworthiness

Sherry Rexroad

Craig. you, Thank

over STORE, great working investors here but thrilled like all would I as I well. I am be full received I analysts here to few have you. look from past First, to of only the to forward and not say for months, am our at with warm and how welcome the

in markets $XXX I'll income to reflecting sheet full from from our turning representing our the Please to unless from approximately our are in the estate a otherwise for projections of Beginning XXXX, fourth results quarter's positive going our guidance. this receivables, Now the million, allowed trend revenues half activity and of million an note, this so the noted. our year partial a the ago external the acquisitions of at large all update business quarter plus Revenue is into fourth our on the statement, quarter half first previously of with fourth balance forward. had real the revenues on our year by which than portfolio. nice quarter A increased portion and quarter closed quarter is a us quarter posted, revenue year-over-year, in we increase the $XXX activity, increased in collected financial December, quarter last quarter from $XX providing capital of acquisition acquisition third resulted reserves XXXX from revenue comparisons full XXXX. acquisitions. growth cash primarily during hand, growth fourth our to release million, payments rent of in momentum the activity, net our XX% and contribution the for increased discussing More volume including begin level

Turning now portfolio, estate made partially expense by by to Interest million in debt. growth cost ago expenses. the from quarter, real year overall to reflecting of lower support borrowings our we offset a $X.X increased

for to during of result year ago. interest of decrease weighted rate million the a largely $X.X down as a long-term a on our in were significantly made our from the $X.X pandemic, due capital property decrease accruals of tax was demonstrating average the our As totaled markets million a Property fourth strengthening X.X% from quarter, reversal costs, customers' performance. marked the activities year XXXX, ago. which December was X.X% This XX, debt

For million compared as property XXXX. to $XX were million costs in $XX.X the year,

by points average of basis our assets, in basis represented Excluding XX down portfolio XX tenants, property about XXXX for reimbursed our amounts points XXXX. costs from

severance costs costs return million with awards increased pre-pandemic to quarter XXXX. to that We and million of associated management move severance and expenses related $XX.X property million. that transition expect we was amount, related $X.X will as G&A executive accelerated into amortization Of levels compensation to Fourth stock-based $X.X and retirement.

costs our these As AFFO noted in of one-time press release, added calculation. our back are XX Page on

LTIP of incentive portion the was million performance In implemented, increase and reinstated quarter was million. has must year, We these to there AFFO we $XX.X March the had first be million accounting reversed and due rule, a target. our determined being quarter be XXXX, expense memory, $XX was XXXX, million the it COVID to in to due shutdowns in impact of relative which million, expense for the evaluated the recognized. $XX.X would as the much granted quarter then was the refresh G&A we compensation Per as not certain the how an each awards. should $X.X both which by fourth cap we XXXX. awards of achieve Therefore, are the amounted component. For management and long-term of recognized transition of an XXXX expense AFFO for of items $XX then in AFFO to To everyone's

stock-based Excluding and we year full transition from basis grow. This illustrates the the XX the expense down for XXXX. our compensation portfolio portfolio were and noncash severance for XX trend expenses increased full costs points continues of both as platform average one-time of G&A periods, of points efficiencies scalable assets, basis year from to XXXX gained from the

increased aggregate a impairment During includes an to increased million. loans impairment ago. $X per on higher increase provisions million $X.X revenue The and diluted $X.XX the real with real On which in per properties. financing AFFO $X.X fourth million receivables our and estate from associated six an from portfolio AFFO share from provision, quarter, AFFO we Fourth growing recognized million estate XX% aggregate costs. quarter recognized and basis, million portfolio lower $X.XX primarily property share $XXX our reflects to year a $XXX of

and primary of lower cash as were: higher-than-expected from $X.XX $X.XX portfolio full approximately the the and year administrative XXXX costs. a guidance I'd share, our share. revenues result diluted the and improved like drivers increased expenses to to of $X our the receivables, of XXXX with general Mary basic for lower-than-expected collections or per $X.XX year color per our more over As about $XXX from on $X.XX guidance. and on interest AFFO from AFFO million provide Compared high property end about mentioned,

in We momentum are portfolio. growth our generated AFFO very performance of pleased the by strong with the

we As to XX XXXX of a on which many of fourth dividend per declared you know, on January we December quarter shareholders paid share, of record $X.XXX XX.

the and to capital turning our activity. sheet markets Now balance

options growth. We multiple flexible available and our are fortunate fund have to to

debt activity acquisitions full of our through with from public revolving year, variety cash of strong of the funded quarter proceeds ATM the the Master offering XX% program including and issuance on borrowings sources, closed Funding activity acquisition about with we credit We closing the in and second For the the our acquisition equity facility. quarter. $X.X of in billion November, in the our fourth proceeds a from sale

equity $XX.XX of we X.X of share, the ATM quarter, at raising per stock program common million. shares price $XX under During issued approximately our million average net of an proceeds

macro of is We are equity mindful of where our cost the today given headwinds.

basis. had XX, a outstanding to had of as X.X%. or cost average of earlier, seven weighted acquisitions on turning Our improving begins the of we senior weighted a us to our at million debt notes sentiment market we long-term continue average at of from X.X%. is in rate debt-to-portfolio of We rated EBITDA In rate market basis and, to rate at issuance price. an anticipated stabilize. of with to December low XX-year We lower model further attractive years of $X into forward the this capital. allows make that net rate current Leverage the of debt the issuing accretive STORE million business proceeds run fixed noted opportunity look net to an by stock advantage penalty debt of X.Xx of hikes, certainty coupon our about billion and us a At investor on interest investment-grade to a used target coupon Funding November, about unsecured prepay $XX debt cost a speculation $XXX a without allowing range end XX% Fed as the to at Master approximately at interest took X.XX%, providing portion maturity a

well-laddered. Our intentionally debt maturities are

Master additional windows will balance XXXX under and prepay we debt opportunity our the during strong As a We current therefore lower has X% coupons Funding sheet. further X.X%. program, to with to which mentioned, the the the our three have from with series, from X% prepayment Mary us to flexible ranging about year closed cost allow

with million facility. capital to under million program immediate our ATM access approximately borrowing million under ample cash, capacity credit in of our $XXX have We and $XX revolving available $XXX

Now turning guidance. to

and performance reductions of on property anticipate pipeline costs rent XXXX are encouraged cash our cost portfolio We efficiencies the in and the strong our of in our $X.XX activity are as well. Coupled increased a AFFO solid in per structure, range of growth as billion. on would acquisition we a cap and benefits guidance our provide our XXXX. billion with range will payments also X.X% X.X% $X.X which raising $X.X to be to Today, $X.XX, to seeing of volume to that to acquisition and result of we are net we share expected from for represents the realize Guidance continues continue to by like an sales based be XXXX of acquisitions, period anticipated to we over not is X% to guidance of share the to sensitive AFFO only and the X.X% year. activities. per timing capital also rate dispositions for property markets in the but amount, any to receivables

the and turn to to As as outlook update I'll through call move our year, With continue guidance we'll that, assess back Mary. we needed. the

Mary Fedewa

Thank support STORE, team of ago, strategy, future productive the the very have and you, been years sure incredibly our our year right bright. I so a Company making the we and XXXX future to for right was nearly fortunate had the right XX always have growth. Sherry. part am is to resources Co-founding

skills ensuring to further our analytic management in Both experience and would can Lori added strengthened and deploying has that in a portfolio like members: funding years bring we Alex And year. and second to Operations. also we consecutive that complement overseeing leadership McElyea we Equality to company. nearly our and bench the a you superior. for Business recent and Alex in As existing Both to Econometrics; Analytics for assist proud Gender our and Portfolio to of and advanced is be customers' backgrounds the building of of operations with traded PhD we included promoted Ahsan, in a EVP to Strategy of announce add new exceptional diverse Lori strategy. transactions independent are our and the knowledge David two of I Lori read EVP been talent. that also Markson and Jawad wealth specialty our excited guiding from brings our Board Edwards, press a publicly growth have Bloomberg Board are Data releases, Alex capabilities, CFO six in experience Index

significant culture equality, are rooted of and we levels equity on for In is towards financing. large gender all fill our made a we've focused headway very diversity, organization. need actively While estate we address in nurturing inclusion and important real an market a that and at inefficient summary, capital

The in activity an Our of lane we anticipated spreads. healthy generate allowing are we and in full in environment are to direct to continue to rising mitigants the our rate approach the acquisition is seeing increased us both and sector, swing. level play competition

billion. pipeline growing Our robust, diverse is and at $XX

operationally We are financing costs. to well our on continuing focus structure, our as as both cost improving

well, the questions. all us portfolio the strong maintaining forward With AFFO our for turn keeping disciplined and growth our investment for continues of call and exceptionally to over Our you perform to I'll positions beyond, look operator while this on that, to in and updated progress. approach we XXXX

Operator

your Please first today Kim John, [Operator go question Capital is Instructions] from you now of open. in question. with line BMO comes Our ahead John Markets.

John Kim

of XX% XX-K, us that inflation CPI-based your understand mechanics X.X%. CPI-based. help We I your of last are work? in leases now you have your leases Can above the know

wondering if capped a those or So catch-up a of leases are lot essentially. I'm that to there's

Mary Fedewa

Mary. it's John, Yes.

our of majority or are X.X%. the lag, CPI escalations quarter was which fixed fourth the its of rent in X.XXx lesser the So,

our is X.X%. as today, inflation at are we it with definitely leg getting So high fixed as

John Kim

is catch-up that? there And to Okay. mechanism a

Mary Fedewa

are et John, And and that not conversations the fact frequent have is No, we today, one. in the cetera. with directly ask inflation rising, there would we escalations. What able talk customers, about is with say, business we escalations, ask I we're the calling customers environment to our is for that for that do and model on

-- we those are So of market We have are we what conversations. to do mindful is. able

this X% wouldn't about I sort talking off is you in that. so for And long-term so, are be with run, having high customers a have be environment, calling would long I higher of and inflation And X% would or of your But these probably rent. -- and phones X% opportunity at and is little But expect there or would contracts. the ringing than could would X%, the conversations hook of increase in that like you be sort market say we're say we that investments. this wouldn't

Operator

next from of now open. your Stanley. question you Please in comes Morgan Camden Ronald, our ahead Ronald line with is And question. go

Ronald Kamdem

Great.

by the forth, provide some industries compression up Just on of on you can maybe and you bit Maybe look some industries little a comments of at? rate that bit. more the so on or manufacturing little cap picking color whether other a how the bigger trends that

Mary Fedewa

Tyler? Yes,

Tyler Maertz

in Tyler. sector Ron, like to say, industrial seen the Yes. it's seen sure, side Yes, everyone compression so, the for would we've be I things. most continues manufacturing in And at of that else. the definitely we've

Ronald Kamdem

of sort of time. points, Just it what quantify we can basis you've get over to seen just sense any Is basis And and what a that? XX XX trying points? --

Mary Fedewa

this Mary. is Ron,

mean significant those money transactions in to sort is low mean rates the certainly substantial, reduction of what favor seeing of rates amount substantial the so space, center a those distribution raised are chasing the cap that rates space. raised I there's are sort size be a And a -- the lot I And been logistics we're So, industry, and money quite the it areas. seems in fixes. -- in when in of by cap bigger that and

a seeing bidding those of over I transactions, $XXX transactions. for certainly larger people over We're say for So lot would XX, million.

is price this we're process can able news where individual we to quarter, and XX-year have So that STORE good an business deals million about $X to old continue that individual the each platforms we deal.

to -- pressure wars to of what call, or the, advantage organically and in going that I be here and not able on out so, a bidding are play not we have there. be real to sort And feel grow

the keeping down, real have staying platform to fortunate really head we're solid we're to do that, and our and So, we're patient here.

Ronald Kamdem

my then I last one, And Great. may. if

remind just tenants was of collection you us could the cash and basis, about that the quarter, still -- theme sort sort you Is a just that of there theaters? that drove it receivables what the on across a talked -- in could board or percentage Or is are the that you of is improved If a is trend of cash that to? of sort that when that sort that? all point on

Sherry Rexroad

Ron, the it's the half Sherry, take and I'll first of question.

Our relative cash quarter to the And X.X%. basis was relative about That at tenants very is history, of are third it to at similar. 'XX, X.X%.

the So specifics. you But normalized trend downward back to that let cover a area. see Craig I'll coming tenant

Craig Barnett

opportunities Yes. industries. In isn't. of kind They're the increase, It's seeing actually of some the of all to in there government any really shuttered The all with collections, theme paying paying deferrals in the balance as are that grant us across the program are that provide you're is our to any theaters, the agreed Ron, to impacted refinancing the due venue kind highly regards to deferrals. that regards back. sheets them their any tenants assistance capital the or just pay earlier with doing

Operator

comes with go Ki question now of you today And ahead Please from question. Ki your Bin, Truist our line Kim Bin third is Securities. open.

Ki Bin Kim

capital your acquisition with you're what we very about about robust to in still cost talk you of Could in happening XXXX light end leverage of up and how the appetite? what's thinking

Sherry Rexroad

it's Sherry. Bin, Ki

both year, in for us the that and to had corporate XX-XX we're that both as place, us stick last enough market equity And the model So see approach acquisitions. market. and to Master our to of to Funding you to debt evaluate our you'll the of we've debt so we're which effective unsecured is fortunate ABS program and us as continue saw evaluate take have well funding those, more in advantage going

Ki Bin Kim

you what basis? in of a would mean that a terms do have debt-to-EBITDA So sense of

Sherry Rexroad

to just stick debt-to-EBITDA X.X, in the of net ended XXXX at range room there's plenty so of there. We'll We X. the to X.X

Ki Bin Kim

in supplemental in shown the one-time we you've annualize what that mentioned, X.X you some just the and items got of that And that does the XQ.

Sherry Rexroad

removed are The from one-time items calculation. that

Ki Bin Kim

a of of Okay. starting are that question attractive can less alternative This to capital source for, compared But more And question. to guess, offer? a might capital blanket just I STORE your for is tenants? primary what now look me. second of the alternative source majority And attractive be or the what

Mary Fedewa

to for financing might some and escalations has XXX% their where to a you superior bank estate flexible -- today financing lease XX% our actually say as to Ki to relates would long-term your or a choice having leaseback get but they estate had that choosing and a equity. real doing a make. that relates I comparable real real funding customers, capital then modest lease a stacks, So is Bin, they choice is to have to But and estate your XX% have you got to you've it sale it choice as own versus the can raise

So lower immediately, capital. cost of we their

really are a source that's earn the market. reserve business, we of of great the there that -- that we selective. as real that companies and And do us makes for -- estate in lot really a up, their complementary really the hand their got and inefficient of everyone's aren't be a it estate large need So, but their where we big so we're their their where are we're to business, talk can products market profits to market these a out the really -- beauty that's or is just long-term not And stuff the about to in. this real we stack, inefficiency capital they're

-- kind sources. how So, of think their I we're that's of of the customers sort evaluate

Operator

ahead Burrows Goldman line go from is the comes Caitlin, question with now open. Caitlin Please you of Sachs. next The on your line question.

Caitlin Burrows

you side, started deal portfolio about the could I that talking deals. you on consider think portfolio had XXXX, Mary, Maybe in

and partners. or they've to how So update you've any you customers potential been made maybe wondering if received what have that, by efforts

Mary Fedewa

you Caitlin, bet. Yes.

good really reputation that -- have our a organic now a and that in talked So approach seasoned being our marketplace. the earnings is portfolio three-pronged in second fact being growth; years, execution, solid about the first we we strong August in calls:

portfolio We diversity. bricks a to still scale showing and ability say into I'd whole of strategy maintaining then to brick-by-brick having our larger and while bag say the integrate the like granularity I like doorstep. to the at or have transactions and up

lot So point cap I highly rate we XXXX, that will larger there now, we're comfortable marketplace you we're seeing in with. some seeing tell We looked that driving than so the becoming at really sort the right a some. very transactions of at have looked -- much really a money at and competitive in we're but of lower

going to our be at story this we to disciplined that definitely we're we approach, think and continue going our poised so, of course. could here. but not to the in point dilute we're patient, And cycle are we -- life And to stick integrate

going a there now, to watching Catlin. right but competition keep we're lot of So,

Caitlin Burrows

it. Got

So, marketed on kind deals be of... would might that opposed widely more that potential portfolio be ones those as to

Mary Fedewa

Yes.

marketed. Catlin, we now the I being right transactions think larger lost widely are but more definitely

Operator

question go question. And is your our of from KeyBanc now with you line today open. comes next Please Thomas Markets. Todd Capital ahead Todd,

Todd Thomas

when specifically provide around drove provided behind the the to the What was it I increase, relative you more could if guidance? guidance just a little factors bit wondering as Just outlook pertains you that there improved to increase. initially detail

Sherry Rexroad

approximately continuing on then, course, their Sure, -- up And course, but of to the due savings beat, to $X.XX look tenant COVID back of management deferrals. G&A positive is if quarter the add repaying fourth their This is payment five from the their have recurring one-time, that we transition. Todd. and Sherry. to momentum. leases of you And picking interest And is

of is So the five we recurring. think $X.XX

and then You taxes. lower are property to pay from their as could also tailwinds additional have reversals tenants able reserve further costs

think we is there. again $X.XX potential could then is the have some recurring, you what tailwinds and in So

Todd Thomas

think embedded I previously it the additional the trend, Okay. for then the what guidance? the to that Can talk so actually related like that collections year. trend is in reserved What in And quarter you in heard the 'XX. Of the positive guess $X.XX guidance were that, for -- quarter? are amounts, into I realized reserve sounds full about I fourth was factored that reversals

Sherry Rexroad

Okay.

we're going the in the is quarter, the just of so end which the we of that to we'll have anticipate by into quarter, The that XX%, practically So that gone excess to let's expect has talked receive that we fourth we -- And and the all 'XX, -- end and about. your continue was address by -- first payments. XXX%. full forward XXXX, fourth going the the XXXX, from $X.XX was question,

Operator

question line is next you now question. Our from on line Linda, the go Linda open. with of your Tsai ahead Please Jefferies. comes

Linda Tsai

question. another Just guidance

benefit you XXXX? In XXXX. property normalize Does terms accruals, I said of is that supposed some tax it there reversal think in of mean that in the to was

Sherry Rexroad

be basis you gone we've want basis XX an a which are basis qualification? end -- do few basis to that. points? from less normal, XX would a that Or do you points, just Well, different Is than points points need

Linda Tsai

if to just a I that's get fine. guess I trying there sense was more... of was

Sherry Rexroad

into you're was XXXX That that's what if asking.

but We normalized benefits guidance. in our are in expecting additional XXXX, tax property it's

the So so XX. the get XX XX us normalization is basis the to to points, below

Linda Tsai

of the XXXX? in expect a forward? for quarter, we terms going And the Should like just helpful. higher percentage I deals was just look then pipeline What XX%. the said in you relationship-based that That's deals around of Okay. does think relationship-based it occurred

Mary Fedewa

Linda, towards this on is Mary. we our should deals. relationship X/X I'd probably back -- we'll say that

right still think building on pickup customers of helpful? demand the that a pent-up little existing we're our they're pipelines on pipelines. Is tailwinds seeing really with I some bit of now their that a just and executing out had now, and coming COVID

Operator

Street. queue question you question. from now your Spenser, open. Sorry, is Please Green the line the ahead of next comes Allaway with go in Spenser

Spenser Allaway

around Can there the be expected should Board? with any Chris on that changes you longer-term And please provide leave for the are to his post this? decision to the some strategy color

Mary Fedewa

is this Mary. Spenser, Yes,

the about of proprietary I, to a bit to they're all more by we integrate we story. going a have the spoke lot time way managing that even lot we're the into diluting that and portfolio. use -- integrating then efficient the portfolio of spending remains it little just center -- cofounders and the and the love strategy, a business, and make from on foundation this we business, and love Chris a platform we the platform brick, to same. this brick now the data we're without the size we're And our in prospecting could built both of understanding that And we I this together. also but So in estate profit real strong so fundamentals

strategy going that's going the that's be. be the -- to strategy. It's So, what to is

independent longer once new was to with and relates no complete would the served it skill Chris, As chair was there transition sets. the executive the that by members best felt management need be for board really having a the role, new Board Company

Edwards would and Juha Tom we Chairman And him have excited worked really I me we're know, Board his. for over years. the really a then the ready members, the we're Dave decade. and you And time as like two next Non-Executive second And role. and both them, we're excited And say we into So XX Kelly us. long take to all of excited to STORE and And about we to I excited Chris, we're our for and personally new Board guess to we've Hasan. independent, have we're appointed with about all wish of chapter,

Spenser Allaway

get Okay. I side. just upon as or executive C-suite sense it's makes transition. Why if an was -- have guess obviously of just I just on -- seems Why have have chairman a of the the the to it over chair of have rid the bit exec not to period time taken angle a you mean not management guys the post that for the I have all strategy Chris little though goal again kind is you to the go if mean after helm? such overlapped. position that him short

Mary Fedewa

here. position was position, and that. veteran the Kathy She's alongside in that with CFO. mentioned, that Well, filled, on right XX-year important confident was and It Chris being transition, we was management and fill us a that as we're I

once that's I management that position Sherry the -- solid in transition we But have and pretty important. think was Sherry, key to that wanted sort So that was place, we now. then and found of

the contract So an chair with of that does shareholder. that saving the was -- vote the the that place. -- it and And come solid team move the for it had Board Board that and position And could forward, great we shareholder, for a expense the was terminate position, and that the the ready. executive position confidence in is team for expense. And think I eliminate

Operator

Please on line ahead the of go with from Ladenburg. John your question question, John. The comes Massocca next

John Massocca

of a some the the can The kind of those calling XX for but the think trended be institutional work customers those unfair, lack cap might two of we bucket direct for kind two investment a that as the I STORE, months? little when cap think what better of rate kind And guess -- for about you right? kind term, strategy the with. I between is bit buckets two of So, groups over think larger, last I maybe groups? spread how guess of of I it's have maybe rates

Mary Fedewa

John, it's Mary.

regardless for that the to into the value value. asking the and enough, that work customer the interestingly of the be to is approach So comes that paid we're STORE, and then transaction the is channel the approach same, with business with adding ensure to

our the it's time same. broker it suggested, deal a the or comes even desk, bag where brick a the off or indirect all whether at comes of of approach in in, bricks, is of as I regardless So of one

rates of So, we cap variability here. a in the don't lot

John Massocca

And of question. one then kind Okay. quick housekeeping

we're As vacant property dispositions, cap dispositions? And more of rate not, what it on those the dispositions, relates kind all assets. the management-related if to was

Craig Barnett

were primary Craig. of the majority the is The vacant this the management Yes, of properties. property dispositions

Operator

ahead of go the today question Sheila. your on from question, final comes McGrath Evercore. Please Our with Sheila line

line open. is now You

Sheila McGrath

wondered much just just can coverage a four-wall acquisitions on higher environment. I cap about rate know comment I lease you and if mentioned that. in is net rates rising wondering on could historical you so move higher? How quickly Mary, perspective Craig the now,

Mary Fedewa

Yes.

You Sheila. bet,

will cap been -- interest interest and increases. experience historically, do rises, our will we lag -- rate that So they right, rates has rate

lag. single we're environment continuing So in they would -- pressure having I roughly the But could that six you which that are a put know, increased that. this could The with say on see lag new we time, macro environment conversation be would deal much months. as inflationary it think I STORE, environment or months at interest longer competition, deal we and is and will our as in than good the every day are rates, rising. an is news of cap as say every six that -- rates pricing to customers

I the being increased we cap it this effective little with they so definitely say discussion, to And to would raised, we're lag and money rate be continue having lag the hope increased But could be that. -- at longer. environment a in

Sheila McGrath

in Acquisitions question. were $X.X quick billion. other one And Okay. 'XX

billion expected the would given pipeline, And to $X.X dispositions the guidance net you $X.X What's somewhat Your is dispose guidance with billion. conservative? your characterize as year? this for

Mary Fedewa

So, early volume early. portfolio And really I say for is feel guidance on I pretty of that we really, good balance the XXXX in would say for it's would from end I to It's beginning we we One Sheila. two we any might to a would early, about baked perspective, portfolio. did and things. dispositions move that look not be we into have X% -- of like the would about that's volume don't the too deals we suggest volume. that. tell, lower And our the why it's and because number, so

Operator

much. very Thank you

no further closing back We I'll the for so Mary line, have questions hand on remarks.

Mary Fedewa

and your thank you, is in all in exciting, months. you for some which during and you Thank participating support the meantime, continued in call to in interest out look for at seeing next our the our We today STORE. us. conferences and investor pretty reach forward few to of person, And

to day. have, answer any great here questions have and you a are We

Operator

concludes much. That you Thank call. today's very

you. good afternoon. You lines. may now your Thank a disconnect Have

Store Capital (STOR) 24 Feb 222021 Q4 Earnings call transcript