VICI - Earnings call transcript Q1 2018

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Operator

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the VICI Properties’ First Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. Question-and-answer session will follow the formal presentation. conference being this X, today, that XXXX. note, call recorded is May Please turn to call ICR. will the I now over Jacques with Cornet Please go ahead.

Jacques Cornet

to website be found Thank should the Investors XXXX good and the in release. the VICI of access Properties’ earnings can you, quarter www.viciproperties.com. Company's release morning. The Section first at operator, have Everyone

of the federal of management's the within meaning comments Some laws. today statements will be forward-looking securities

expect. or Therefore, results as other usually the are could impact by use will, identified the interpreting to to expect, such Company's risks we relying you could SEC should and future materially filings operating risks phrases on that results more Forward-looking uncertainties statements, in financial of which and what numerous similar them. of their subject to for condition. I are that discussion words you exercise from should refer and a cause caution detailed differ actual

Company. I'll the non-GAAP the to quarter and questions. With Officer; David is Pitoniak, can discuss Hosting During in measures first be we in will prepared John our call call we'll turn these a to should isolation XXXX measures performance. considered have some and earnings Officer the management most over GAAP. open provide and Chief useful Operating the then Kieske, the call substitute Ed comparable the not Payne, of we directly today, Management in release. that, opening Ed. believe Chief the with financial reconciliation or Financial President Executive remarks, Officer; The Chief be call, Company's in results measure our These to of as operating will measures, for GAAP which accordance evaluating available

Edward Pitoniak

XXX just be the successful most execute and our good October hospitality Thank $X.X day experiential greatly earnings our second to our estate highlight Welcome in quarter. first America's mission our company. Traded on balance delevering billion, continue morning, dynamic call and which improving Company earnings raised and to sheet, IPO XX emergence real call we you, on our Today expanding was X, of our liquidity, a is reporting XXXX as and The January since calendar on quarter a our leisure at Publicly full our first Jacques, our to and available about everyone. we to in We four to March, for on details remain to of around also powder our deliver base. we shareholder governance capital We pleased on our tenant, our pillars advance independence. the prospects and announce of stewardship, initiatives. and our we investors. but dividend were provide as ended will key distributions to David billion $X.X forward more return first quarter the strategy dry part package continuing key with these portfolio, growth total hard in look the and work, value: focused results, to

growth Our of opportunities is pipeline healthy.

We have and three XX% any properties, a can at now at discretion our we between time take option at October down call cap XXXX. which

ability with And that with strong in? overall years inning REIT all and still in, for do remains of mutually Let’s to remain expect and relationships are together. What five are not what we manner. the than debate have your can fact the a to extended in inning that in gaming at dry but an what developing REIT Caesars We charge, less hard and very old. asset work gaming We're work we other is to sector what beneficial leading going our in inning John the with will deploy on timely time a relationship period about accretive confident about continue opportunities maybe sector in sit capital REITs? strategically We and is industry. operators healthy the ask idle REITs powder start the Our we with any our it.

Market five activity tenants. developing. that confidence case has believe the be is both to trades buyers in there should two generating portfolio picked will major what asset further pace and single gaining all deal down During trades the But as confidence flow this the up. participants, market from months, liquid been were that that we sector. any otherwise are in is the of sellers, recent key than not truly would have more know We period, be and contractually renegotiated dropped or

institutional growth strategy, fund near and That rate. foreseeable to we to that case, $XX Las values At the not, durability the may and Vegas great purchased relationships kind at deploy with of in our in transaction that in brought practice of NOI; are and our cap to what? being know issue IPO, rate. of against worked very real that a rising criteria And anywhere estate our our rates, that belongs income be estate compared not. our it establishing we're million acquisition we other X.X% or of is income sector with question, at kind confident We that no of scale brought of trend transactional advisors. hard future. December, comes we we quality. will course and growth truly great Harrah's the care trading thanks current real have backdrop develop the cool quality, successful to values activities can VICI, a cap which ask capital to Turning to of When asset when either our controllers higher interest higher it and of may established shareholders growth In we or they we discipline. We capital for

inning. in its old, less than and as innings by management our be be capital original we say first we, quality As When Being than years the answered the being days later our is sector a it? is what of REIT XXX we the no are, by five barely REIT should team, we old VICI, judged gaming will allocation. inning third I question, definitions

to details market current in With very turn to environment. batter call be would John? the over to that, the very, provide John the on spot. to like excited are We I more

John Payne

good and Thanks, morning Ed, to everyone.

many what of market to the indicate to mutually us model. that last a underlying the by the is gaming deals been and slow are are the our to to VICI we active. quite business, or is growth consider deals fair continue the growing in our tenant not key confidence We governance, At over beneficial transaction six The understanding and having you executing and months we're the sector that our aware, the the VICI. focus the to down. REIT testament this As environment of announced going peers that currently ingredients assessing are trades our opportunities gaming conversation in and the believe are our keen that trajectory both has we on OpCo for

stay look We will I are With forward in updates to as David, turn you discuss results. very will that, we our active that providing the the several ask tune opportunities who financial and on future. over call

David Kieske

Yesterday, of first $X.XX we’ve for quarter. the AFFO reported Thanks, per share John.

financing of direct golf leased from and of of Our income tenants operating the comprised real taxes earnings and for from million business of on paid revenue earned leases, million, property was million of properties. $X.X our rental leases, $XX.X of $XXX million million by from comprised million income $XXX.X business property the $X.X quarter which Real property business. our $XXX.X reflect our from revenue was

includes the to leases leases, net direct a million from our Our and non-cash earned financing which income for investment $XX.X direct financing quarter a is item. change

quarter. the for and million administrative side, the our On cost general costs $X.X were

quarter incurred continue on in As run steady the to next earnings startup last our work to we state costs, related we we G&A. call, mentioned towards two rate expect or for as which we continue for the transition

quarter to first three Our G&A includes note. items

headquarters Las costs Vegas of to our the corporate severance of from New $XXX,XXX to First, relocation related York.

in in continue advisory and And with legal Second, costs consulting one-time build $XXX,XXX team. we our non-recurring associated recruiting approximately out $XXX,XXX cost work. finally, to professional board as

funds includes from million items these and operations for was and adjusted share. $XXX the per quarter $X.XX Our

Turning sheet. to our balance

IPO million with of $XXX With we quarter just the restricted including cash. X, on ended of our the of $XX.X over February million cash, completion

years. end quarter rate a billion $X.X average average and interest was six and X.X%, a debt outstanding approximately weighted Our weighted maturity of at of

first to times our adjusted leverage and maturity We on times. have X.X annualized our is no results, debt to EBITDA until EBITDA X.X gross is quarter leverage net adjusted Based XXXX.

our along balance dry and billion, of million billion $XXX of to we amount on $X.X transactions entered powder swap The syndicates aggregate brings next debt, counterparties. XXXX. B approximately our notional the approximately fixed our five the financial to of us an and cash with of gives $X.X availability XX% institutions growth LIBOR providing with at of Our facility transactions termination April strategy. a clarity under rate XXXX have interest into our of our transactions These XX, XX, revolving total quarter date a Loan effective debt execute end, rate over Term of expense X.X% credit served our with an of years. interest to to approximately Subsequent and fix date portion to May total

March our XX, you on on IPO questions please line the in we at announced $X.XX of share. basis open for on to AFFO that based share that, per shares reflects cash On an The the count we rate March impact XXXX paid prorated $X.XX year-end, $X.X annual million happy guidance, answer be in XXX the Operator, dividend a on per April With weighted-average the fully which per of February diluted to February. closing X, of was a dividend between our the same-store to XX. quarterly assume have. outstanding per upon share, ending first was our and $X.XX dividend Turning period share. for be expect might we’d We questions. diluted of IPO distribution and any of commencing share XX,

Operator

do JPMorgan. Instructions] have Pace Mike [Operator I question from from one

is line open. Your

Michael Pace

you. Hi, guys. Thank

on or of of you that Just opportunities, I'm your opportunities wondering, said. these to the maybe comments to very you are should doubles baseball earlier back maybe to or of guys are analogy, of terms a and go you clarify couple and larger we those think several singles something active Ed, in that scale? said

Edward Pitoniak

grow great made our adjusted dividend, return. believe knocking very saying, morning. without to time, successful growth. accretive Yes. especially growth doubles. singles wants Mike, really are a question, And If way as we and and We good the always good probably to us REIT. be out risk deliver return and and It’s sustainable acquisition they're a shareholders we goes accretive, to same-store triple-net maybe a if thing going over and of in total We it’s those emphasize give can we up

– Our I say, yield managed asset yield that to underwrite an or accretive the to in not should sector a revenue or in. you going time. where running managed accretion in the hotel property accretive This be I yield your be could need sector way used going like is deals dilutive to managed or over

we’re to careful. going be So

We’re discipline. going be to

going in be we Where magnitude. to those singles be there straight to see achieved, We’re diligent. greater to opportunities and we’re are going achieve doubles and

risk As accretive, return long time as will and as those as on we adjusted is as well. long focus certainly over good

Michael Pace

cash you of on And time. period unlikely to an that said balance then what for be at and period it just just be that sit for an context expect you wondering, guys is extended year also you extended the of should would we would end? cash I'm maybe there timing in of

Edward Pitoniak

going for need is and we the look would our we to Mike, given deals to the investors. price. really deals yes, time non-marketed would the which maybe. as those asset of right, And is owner there to Again, The of accretive marketplace, obviously the year-end, both marketed are exit, best not in happening operator they and for processes in say types would and looking the the highest asset, take it happen will are the will we're they across be look to the in is hope, going of One deals when future. do can and you or fact the two chances be that I in. owner maybe that the it the

that relationships develop, will and category on leaseback, operator stay strategy form leaseback we as time the And those sale the going of sale where The other can the owner our think is category operator take basis. in that a are core forward. relationships of should to those the

and very will deals we're available outcomes both And to again so we're at execute provide cash us. both, at going this time, very to look to at working looking with good that hard that and obviously

Michael Pace

Thanks guys. Appreciate color. the

Operator

question next [Amanda comes from from GS. Grambling] Your

is line Your open.

Unidentified Analyst

is Bill for This Hi. filling Stephen. in

those around over you acquiring time? future that to can approach deliberate just a before mentioned You the us option you properties call remind exercising contracts puts the or either and - those in have near takes

John Payne

speaking. John is this Yes,

five have and Caesars XXXX. of them from emergence get before three we years, five are years coverage, at are cap October days So X.XX notice option, roughly have rent XX% we need call XX in and we the there take to date of there. we They

Edward Pitoniak

opportunities to those that going management to are not and time as the And we we our long years, over going are five have as our opportunities be to next deploy obviously available prioritize both capital.

Unidentified Analyst

just as it That’s the quick shifted an Great. doing different your VICI tenants, then a deals helpful. And competitors as for all? competitive dynamics REIT with independent follow-up,

Edward Pitoniak

do U.S., No, again think that’s over, mean we pursue what really overall it’s for in their it know across the REITs deals to a what as growth that and period model deals least more growth. that us these are is these complex REIT we of role sector colleagues generally super can not time believe that surprising over ambition. the and VICI long-term I focused a portfolios, happening one other among the would is growth you're to to the think their getting – in we're gaming of the that the fact is our with play We and portfolios, finance did at growing last operating footprints virtue deals. being recognition big REIT provider six the to the their emergence a call now, we capital of exciting who hope either the I We or and by of would be exits I what on gaming growing We say things they validated is that in And think regional, to gaming congratulate of those nine seeing point growing finally that finance deal. long – them can their are months, suggesting helping specifically we we done. we

Unidentified Analyst

Great. Thank you.

Operator

Komal [Operator next Patel question from comes from Instructions] Sachs. Your Goldman

open. is Your line

Komal Patel

the question. thanks Hi, for

you M&A, to an the following given more would more be even international up you on or record, So track as on be would infancy focused as such the in well? market markets your for a or potential established newer REIT market, have Massachusetts option

Edward Pitoniak

the in us good far about the going you will we These The think as sure states the in. are will. deals we have are think excited I that do to going itself come within to that that And off all. or that interesting though, wouldn’t be are opportunities come requires for accretive time they under I at we come so that magnitude do model the come triple can exit going wherever are. fundamentals frankly markets again, make – have and net and if beginning probably future. at being accretion in the for to to us of the gaming we're existing

So we will carefully. market evaluate

and and real of of and the its quality and they in We that sure exact will competitiveness systems, and the the then evaluate characteristics, assets market share. make operator building assets the the location good are have fundamental market, good quality envelop its the quality investment buildings, estate of the

opportunity return believe we of gaming we’ll being. again, where state established got good a management time time the get believe in on we for a we So that’s well and the highest pipeline

Komal Patel

of Okay. Thanks. End Q&A

Operator

Instructions] questions in I have for the Mr. Pitoniak, I closing over [Operator CEO further to remarks. turn call no queue. Ed back

Edward Pitoniak

down. our executing are no In make at VICI rapid of and Michelle. closing, progress plans continue strategy you, in to Thank have we excited at we the and slowing

We report and continues Again, our well time growth to providing our grow good progress look when drive portfolio to quarter an results. bye. second your value. believe shareholder update pipeline we again Our on for we superior thank continued we you are Thanks forward and and to our positioned be robust today.

Operator

Thank everyone. conference conclude will today’s call. This you,

disconnect. now may You

VICI Properties (VICI) 4 May 182018 Q1 Earnings call transcript