FCPT - Earnings call transcript Q2 2018 | Four Corners Property Trust, Inc.

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Operator

Good morning and welcome to the Four Corners Property Trust Third Quarter 2018 Earnings Conference call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Gerry Morgan, Chief Financial Officer. Please go ahead.

Gerry Morgan

Andrew. you, Thank

of which course by we make will and During based this on statements, us. to are currently made beliefs forward-looking information the available call, and us assumptions

our by results actual unknown are to will affected control Our known ability or be factors and that predict. beyond

and assumptions performance of are to prove guarantee a will Our be not future some incorrect.

website. some be to our section which can found For the refer of more SEC please our detailed potential risks, description Relations in of Investor filings,

information this on current of the is of All XXXX. today, presented as call October XX,

to this addition, such be non-GAAP In supplemental website. the to financial Bill. reconciliation the over I in FFO measures report can presented AFFO, that, on on our turn With call, and available company’s as will found call

Bill Lenehan

and to us you Gerry. Thank everyone quarter morning you, discuss to Good joining results. third our for thank

continues focus be to on last sourcing our Our one-off opportunities. portfolio since restaurant call and quality,

was X.X% properties during leaseback on tax sale second the tenant rent strong this million major initial quarter. third base coverage corporate-operated the with Our completed represents rent. locations The Chili’s with at X.X represents Brinker front our activity annual now attractive, $XXX largest times. portfolio Chili’s of Brinker of XX of International

low secondary oversubscribed offering, that and million FCPT. strong transaction, maintain Olive we addition an on an August, Garden In quarter, our X.X%. and average access to and new to the Buffalo balance an were leverage. the ensure and equity Brinker support Bell for Wings two the inaugural we $XX.X quarter, at Wild Arby’s. early included a equity we In in investors $XXX to Taco additional closed the markets third to was the to capital In transaction, purchased successful million both which restaurants included and able of Prime sheet with we Washington five debt cap This continue growth an from rate

notes, private ATM X.X%, strong Separately, spreads. our and diversification. rates was restaurant stock is achieve which signed and price quarter an note most of December. note of It average issued in credit of led year program quarter, September, offering offering $XX our notes which industry we second results can via busy strong rate was Darden, overall pricing same-store the During where, sales million included of and also these the lower million $XX.XX. improved our in at The we close $XXX due sale, brands, Olive third we of support we fund In attractive June by an on in in XX- respectively, of and to private X.X% environment, a than continues closed LongHorn listed expected believe, the rising on September. issuance summer. initial XXXX and economy. Despite is all-in a improved interest to handful cap and recent properties the we growth of have benefit for to portfolio This from Garden eight-year

the acquisition to market. Turning

These like forward factors. to let at balance conference see other us start and opportunities. cap as times acquisition Please to to to the if with at acquisition or early quarter meet leverage We many office NAREIT. know home Mill signs in here are rates at fund opportunities. to of net rates to well-capitalized sheet softening beginning look our would X.X time are but low-levered feel you either interest We spending a Valley. lead a with preliminary fourth you reaction increased could with days, this of the and We

Now Gerry Gerry? will you take through financial results. the

Gerry Morgan

$XXX.X rental as after annual adjustments. income the X.X%. a at million, noncash annual rent place, cash cash XX, leases weighted remains the straight-line in and million escalator excluding quarter approximately Thanks, our generated for current base is run-rate $XX.X rent in Bill. rental We on of And average cash third of basis, September

Our expenses, FFO cash part share share that cash in the $X.XX were the quarter with we results of used an short-term started for AFFO the Brinker per sheet which, share represents an by the quarter and million, reported per of approximately impacted noncash all quarter-over-quarter basis, dilutive growth the the we annual $X.X and business, excluding maintain August. we per and flow as the balance million On transaction best effect net in AFFO funding And per and the generated the income from in of by the again, believe, of quarter, quarter, G&A rate stock-based general compensation. after prior costs. cash compensation our acquisition transaction results. $XX for approximately excluding XXXX we’ve administrative In of X.X% similar share to cash, noncash reported guidance stock-based

Turning remainder cash and full of to XXXX, We the for ended back of our the quarter balance X.Xx, million $XXX of well-capitalized sheet. revolver. debt-to-EBITDAre net with $XX.X million the on availability

million December the interest close note priced in which fixed a interest of private fund notes, we million X.XX%. will priced I fixed notes, consisted Bill $XX a signed $XXX a of at at $XX X.XX%, note and XX-year XXXX. As offering, of and of also eight-year rate mentioned, rate that of notes on million

conservative last be we made Importantly, the would continued net of the funding expect After investor investors five sheet to that to back maintaining notes, from approximately our Q&A year, With we’ll debt-to-EBITDAre turn staying debt-to-EBITDAre. the of six of balance our remain to debt and group we we was times a first Andrew existing support. for And offering up debt committed appreciate it under leverage times. X.X and our

Operator

Instructions]. [Operator

James. Please Mings Collin The question first from go ahead. Raymond comes of

Collin Mings

morning. good Hey,

Gerry Morgan

Collin. morning, Good

Collin Mings

softening just that what as those that you expand maybe, seeing are made the just, of you point as are remarks, upon right cap signs now? some far Bill, the of observing that Can you a – rates. are on some you prepared signals

Bill Lenehan

be Property little be bit just I it Not people the balanced now very, very out say of sellers, quarters seems to of see buyers market. balancing to be six that tilted low market we would we at get cap just of little favor inception. pretty seems just as balance for months aggressive, since between to a the seems was, many X,XXX bit. real-time been longer. more a a now It between the on the and little bit in buyers and rates examples which power look say just that more properties it, a don’t quite has in sellers, call happening We numerous than restaurant to being what’s feedback and ago. sellers it seemed

Collin Mings

point, transactions. of Okay. deals, of upon bit relatively little at looked just that to closing And on maybe, large lot more kind – just a your you’ve a expanding and now

your a discount now? portfolio transactions large there in Bill, though, the market just stance, on broadly, right is Just

Bill Lenehan

market. I would million, in difficult for it’s say folks that when you get transact XXXX over exchange to the $XX very

that So portfolio maybe, different, sort But to you of, that of it’s a buyers. discount. set I wouldn’t more go a large there’s claim

Collin Mings

has switching little going a Brinker concept sizing, at likely appropriate will what’s the exposure Recognizing tenant forward, Chili’s as the a have you or while, to Chili’s and exposure revenue Darden any about of obviously, you how thinking you been and just a now. continue then to likely one to be look recognizing, just are deals. bit And Okay. lot exposure the again, tenant, bulk of level of for

Bill Lenehan

Yes.

of balancing of the it’s concept the real the credit how the estate, the attractiveness deal. the is durable profile, I pricing think and

similar of, last where these exercise. I multi-variable it’s portfolio growing, We circumstance sort a our we, think so of certain the the exposures. with Bob Evans year, understanding into portfolio had So we of can targeted that grow is a percentage some

would say, science. art, not it’s I So,

Collin Mings

I’ll and me from one it last One enough. turn Fair over.

strategy Just broadly, us – update you’ve, executing has out it. steadily Bill, your as again, of, just on and proven now been kind

Just maybe on departure, look opportunities maybe sort maybe not on to a complete margin of then? thoughts but or you the might something your can service guys related at or seeing food any you latest about else in touch, moving distribution, adjacencies

Bill Lenehan

have bunch whole an look of property. to put to continue on – yet we a We at Collin. non-restaurant But stuff, in LOI different a

been to understand in sure So that net change. a monitor going very to-date, that’s haven’t we We classes. what’s active. it. little thing make asset sensible we lease on But other We think

Collin Mings

you it I’ll over enough. turn guys… Fair to

Bill Lenehan

that, exception, but and a the Chipotle we’ve that acquired while the the in it call spoken other one of We’ve Verizon anchored. With restaurants hand widely, on handful have one Collin, some to I those. date, Starbucks continue we’ve I’ll store. tenants, looked place side-by-side, different one restaurant assets two think, looked. say, is the a at consider a we’ve to the that some But of on that’s and let’s that, about middle properties as we have also

Collin Mings

Okay. Fair the for enough. Again, color, Bill. thanks

Bill Lenehan

Collin. problem, No

Operator

[Operator Ladenburg go Massocca John from we Instructions]. have question Thalmann. Please And ahead. a of

John Massocca

morning. Good

Bill Lenehan

Good morning, John.

John Massocca

for acquisition you coverage the casual need going segment? concerns – maybe the metrics casual to in about to the sale the dining similar another ones given segment, sizable just if overall dining leaseback So the see do to would you’re health of Brinker the maybe

Bill Lenehan

dining that very lot the we So, a better this. have a begin stabilization, I implemented signs couple casual of initiatives think than to it a is show see coverage of to showing need we to say obviously, was these last progress. of that lot don’t year dining sensible. of companies doing It’s comments, think, I casual like would meaningfully would

some that didn’t the it ways, at the think at levels properties It ensuring reasonable what setting Darden are rents – has, in learned healthy. market I affects from pricing. did the and

structure had on you aggressive transactions deal in we we of reflective bright that’s wouldn’t that pricing that But do dining. to the more need kind Brinker casual the and say coverage. were that it’s So the test line with a coverage I of prior than

John Massocca

to possibility the that and time to, basis? close partializing that mind Okay, your assets asset takes it given any from maybe, the makes all still the as out is individual Is of in in an maybe just sense. fall everything transaction. deal of assets long with individual switching then it potentially as kind takes WPG – gears other the taken it And some looks it’s of, there good or some large of might

Bill Lenehan

Yes.

it long will we’re of just several replicate a by happy And of – But a I We into knew take the takes. get with added out. think bunch or as two But the really obviously, long would other one the that assets going acquisition. them. assets we’re in It’s with that surprised But other taking would we possible at it fall also time. it time day, end it to takes possible – been Have them that to it’s seeking parties. as as this. longer? assets Yes. it takes of replace

John Massocca

of it million or one just first expecting million, kind overall $X.X XQ Understood. in guidance And one-time in the of given last in the and full-year then is you’re $XX cash is issue G&A year the months question, something of conservatism? there nine

Bill Lenehan

The latter.

John Massocca

much. you it very from Thank guys me. Okay. That’s

Gerry Morgan

John. Thank you,

Bill Lenehan

Thank you, John.

Operator

for any I back our remarks. over conference concludes Bill This Chief session. Officer the closing question-and-answer turn to would Executive to Lenehan, like

Bill Lenehan

if the you again, us conference Thank at reach meet the out. team, our or don’t to everyone. home at with like everyone meet and to anyone Thanks, hesitate please and would office

Operator

presentation. The now for Thank you conference concluded. attending has today’s

disconnect. may You now

Four Corners Property Trust (FCPT) 30 Oct 182018 Q2 Earnings call transcript