FCPT Announces Fourth Quarter 2023 Financial and Operating Results
- None.
- None.
Insights
The reported increase in rental revenue and net income by Four Corners Property Trust (FCPT) demonstrates a robust performance, particularly in a period where real estate investment trusts (REITs) are navigating through economic uncertainties. The 15% rise in rental revenue signifies a strong operational capacity, likely driven by strategic acquisitions and effective property management. The high rent collection rates nearing 100% reflect FCPT's ability to maintain a reliable tenant base, which is crucial for cash flow stability.
From an investment perspective, the uptick in Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) per share, albeit modest, is a positive indicator of FCPT's financial health. These metrics are vital in assessing a REIT's performance as they provide a clearer picture of its operating performance by excluding the effects of depreciation and other non-cash items. The slight increases in FFO and AFFO suggest that FCPT is managing its portfolio efficiently while delivering incremental value to shareholders.
The dividend declaration of $0.345 per share aligns with the company's financial results and represents a tangible return to investors. Dividend stability and growth are often key considerations for REIT investors and the consistent payouts by FCPT may be viewed favorably in the market.
FCPT's strategic acquisitions, totaling $333 million, have expanded their portfolio and contributed to a 14% growth in rent, which is indicative of an aggressive growth strategy in the REIT sector. The initial weighted average cash yield of 7.4% from the new acquisitions is a critical metric for investors, suggesting that these properties are expected to generate strong returns relative to the purchase price. The weighted average remaining lease term of approximately 7.8 years offers long-term visibility into FCPT's revenue stream, which is a positive sign for investors seeking stability.
The disposition of a property with a gain also indicates active portfolio management. By capitalizing on market conditions to realize gains, FCPT demonstrates its ability to strategically cycle out of assets when appropriate. This can optimize the portfolio's performance and provide capital for reinvestment into higher-yielding opportunities.
The leverage ratio of 5.5x net debt to adjusted EBITDAre is within a reasonable range for REITs, implying that FCPT maintains a balanced approach to leveraging, which mitigates financial risk while still allowing for growth through debt financing.
The capital raising efforts through the at-the-market (ATM) program reflect FCPT's proactive approach to maintaining liquidity and funding its growth initiatives. The ability to raise capital at an average price of $25.34 per share, in a potentially volatile market, speaks to investor confidence in the company's fundamentals and future prospects. The $259 million of available liquidity, including undrawn revolving credit facility capacity, positions FCPT favorably to take advantage of market opportunities as they arise.
It is important to note that the real estate market, particularly the commercial sector where FCPT operates, may face headwinds from economic factors such as interest rate changes and consumer spending patterns. However, the company's diversified portfolio across 47 states and high occupancy rates suggest resilience against localized market downturns.
Overall, these financial results and strategic moves by FCPT may lead to a positive perception among investors and analysts, potentially influencing the stock's performance in the market.
Management Comments
“2023 was a solid acquisition year. We grew rent
Rent Collection Update
As of December 31, 2023, the Company has received rent payments representing
Financial Results
Rental Revenue and Net Income Attributable to Common Shareholders
-
Rental revenue for the fourth quarter increased
15.0% over the prior year to$57.6 million $57.0 million $0.6 million -
Net income attributable to common shareholders was
$24.4 million $0.27 $22.9 million $0.27 -
Net income attributable to common shareholders was
$95.3 million $1.07 $97.8 million $1.20
Funds from Operations (FFO)
-
NAREIT-defined FFO per diluted share for the fourth quarter was
$0.41 $0.01 -
NAREIT-defined FFO per diluted share for the twelve months ended December 31, 2023 was
$1.62 $0.02
Adjusted Funds from Operations (AFFO)
-
AFFO per diluted share for the fourth quarter was
$0.43 $0.02 -
AFFO per diluted share for the twelve months ended December 31, 2023 was
$1.67 $0.03
General and Administrative (G&A) Expense
-
G&A expense for the fourth quarter was
$5.5 million $1.5 million $5.2 million $1.2 million -
Cash G&A expense (after excluding stock-based compensation) for the fourth quarter was
$4.1 million 7.1% of cash rental income for the quarter.
Dividends
-
FCPT declared a dividend of
$0.34 5
Real Estate Portfolio
-
As of December 31, 2023, the Company’s rental portfolio consisted of 1,111 properties located in 47 states. The properties are
99.8% occupied (measured by square feet) under long-term, net leases with a weighted average remaining lease term of approximately 7.8 years.
Acquisitions
-
During the fourth quarter, FCPT acquired 6 properties for a combined purchase price of
$12.8 million 7.4% , on rents in place as of December 31, 2023 and a weighted average remaining lease term of 15.2 years.
Dispositions
-
During the fourth quarter, FCPT sold one property for sales price of
$3.8 million $0.3 million
Liquidity and Capital Markets
Capital Raising
-
During the fourth quarter, the Company sold 1,017,364 shares of Common Stock via the at-the-market (ATM) program at an average price of
$25.34 $25.2 million
Liquidity
-
At December 31, 2023, FCPT had approximately
$259 million $16 million $8 million $234 million
Credit Facility and Unsecured Notes
-
At December 31, 2023, FCPT had
$1,121 million $430 million $675 million $16 million
Conference Call Information
Company management will host a conference call and audio webcast on Thursday, February 15 at 11:00 a.m. Eastern Time to discuss the results.
Interested parties can listen to the call via the following:
Phone: 1 833 470 1428 (domestic) or 1 404 975 4839 (international), Call Access Code: 601472
Live webcast: https://events.q4inc.com/attendee/452973381
In order to pre-register for the call, investors can visit https://www.netroadshow.com/events/login?show=a4a4eaa5&confId=59555
Replay: Available through May 15, 2024 by dialing 1 866 813 9403 (domestic) or 1 929 458 6194 (international), Replay Access Code 934206
About FCPT
FCPT, headquartered in
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements include all statements that are not historical statements of fact and those regarding the Company’s intent, belief or expectations, including, but not limited to, statements regarding: operating and financial performance, announced transactions, expectations regarding the making of distributions and the payment of dividends, and the effect of pandemics on the business operations of the Company and the Company’s tenants and their continued ability to pay rent in a timely manner or at all. Words such as “anticipate(s),” “expect(s),” “intend(s),” “plan(s),” “believe(s),” “may,” “will,” “would,” “could,” “should,” “seek(s)” and similar expressions, or the negative of these terms, are intended to identify such forward-looking statements. Forward-looking statements speak only as of the date on which such statements are made and, except in the normal course of the Company’s public disclosure obligations, the Company expressly disclaims any obligation to publicly release any updates or revisions to any forward-looking statements to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any statement is based. Forward-looking statements are based on management’s current expectations and beliefs and the Company can give no assurance that its expectations or the events described will occur as described. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements. For a further discussion of these and other factors that could cause the company’s future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the company’s most recent annual report on Form 10-K, and other risks described in documents subsequently filed by the company from time to time with the Securities and Exchange Commission.
Notice Regarding Non-GAAP Financial Measures:
In addition to
Supplemental Materials and Website:
Supplemental materials on the Fourth Quarter 2023 operating results and other information on the Company are available on the investors relations section of FCPT’s website at investors.fcpt.com.
Four Corners Property Trust Consolidated Statements of Income |
||||||||||||||||
(In thousands, except share and per share data) |
||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
2023 |
2022 |
2023 |
2022 |
|||||||||||||
| (Unaudited) | ||||||||||||||||
| Revenues: | ||||||||||||||||
| Rental revenue | $ |
57,614 |
|
$ |
50,085 |
|
$ |
219,881 |
|
$ |
193,611 |
|
||||
| Restaurant revenue |
|
7,529 |
|
|
7,279 |
|
|
30,725 |
|
|
29,583 |
|
||||
| Total revenues |
|
65,143 |
|
|
57,364 |
|
|
250,606 |
|
|
223,194 |
|
||||
| Operating expenses: | ||||||||||||||||
| General and administrative |
|
5,527 |
|
|
5,159 |
|
|
22,680 |
|
|
20,043 |
|
||||
| Depreciation and amortization |
|
13,320 |
|
|
11,051 |
|
|
50,731 |
|
|
41,471 |
|
||||
| Property expenses |
|
2,808 |
|
|
2,154 |
|
|
11,550 |
|
|
7,989 |
|
||||
| Restaurant expenses |
|
6,986 |
|
|
7,097 |
|
|
28,707 |
|
|
27,822 |
|
||||
| Total operating expenses |
|
28,641 |
|
|
25,461 |
|
|
113,668 |
|
|
97,325 |
|
||||
| Interest expense |
|
(12,361 |
) |
|
(9,822 |
) |
|
(44,606 |
) |
|
(36,405 |
) |
||||
| Other income, net |
|
110 |
|
|
292 |
|
|
919 |
|
|
542 |
|
||||
| Realized gain on sale, net |
|
288 |
|
|
555 |
|
|
2,341 |
|
|
8,139 |
|
||||
| Income tax expense |
|
(80 |
) |
|
(28 |
) |
|
(130 |
) |
|
(237 |
) |
||||
| Net income |
|
24,459 |
|
|
22,900 |
|
|
95,462 |
|
|
97,908 |
|
||||
| Net income attributable to noncontrolling interest |
|
(30 |
) |
|
(31 |
) |
|
(122 |
) |
|
(136 |
) |
||||
| Net Income Attributable to Common Shareholders | $ |
24,429 |
|
$ |
22,869 |
|
$ |
95,340 |
|
$ |
97,772 |
|
||||
| Basic net income per share | $ |
0.27 |
|
$ |
0.27 |
|
$ |
1.08 |
|
$ |
1.20 |
|
||||
| Diluted net income per share | $ |
0.27 |
|
$ |
0.27 |
|
$ |
1.07 |
|
$ |
1.20 |
|
||||
| Regular dividends declared per share | $ |
0.3450 |
|
$ |
0.3400 |
|
$ |
1.3650 |
|
$ |
1.3375 |
|
||||
| Weighted-average shares outstanding: | ||||||||||||||||
| Basic |
|
90,467,426 |
|
|
83,941,172 |
|
|
88,526,343 |
|
|
81,590,124 |
|
||||
| Diluted |
|
90,703,366 |
|
|
84,190,208 |
|
|
88,747,028 |
|
|
81,807,065 |
|
||||
Four Corners Property Trust Consolidated Balance Sheets (In thousands, except share data) |
||||||||
| December 31, 2023 | December 31, 2022 | |||||||
| ASSETS | ||||||||
| Real estate investments: | ||||||||
| Land | $ |
1,240,865 |
|
$ |
1,115,827 |
|
||
| Buildings, equipment and improvements |
|
1,708,556 |
|
|
1,539,875 |
|
||
| Total real estate investments |
|
2,949,421 |
|
|
2,655,702 |
|
||
| Less: Accumulated depreciation |
|
(738,946 |
) |
|
(706,702 |
) |
||
| Total real estate investments, net |
|
2,210,475 |
|
|
1,949,000 |
|
||
| Intangible lease assets, net |
|
118,027 |
|
|
106,206 |
|
||
| Total real estate investments and intangible lease assets, net |
|
2,328,502 |
|
|
2,055,206 |
|
||
| Real estate held for sale |
|
- |
|
|
7,522 |
|
||
| Cash and cash equivalents |
|
16,322 |
|
|
26,296 |
|
||
| Straight-line rent adjustment |
|
64,752 |
|
|
61,027 |
|
||
| Derivative assets |
|
20,952 |
|
|
35,276 |
|
||
| Deferred tax assets |
|
1,248 |
|
|
988 |
|
||
| Other assets |
|
19,858 |
|
|
12,272 |
|
||
| Total Assets | $ |
2,451,634 |
|
$ |
2,198,587 |
|
||
| LIABILITIES AND EQUITY | ||||||||
| Liabilities: | ||||||||
| Term loan and revolving credit facility ( |
$ |
441,745 |
|
$ |
424,134 |
|
||
| Senior unsecured notes |
|
670,944 |
|
|
571,343 |
|
||
| Dividends payable |
|
31,539 |
|
|
29,064 |
|
||
| Rent received in advance |
|
14,309 |
|
|
11,710 |
|
||
| Derivative liabilities |
|
2,968 |
|
|
9 |
|
||
| Other liabilities |
|
30,266 |
|
|
24,017 |
|
||
| Total liabilities |
|
1,191,771 |
|
|
1,060,277 |
|
||
| Equity: | ||||||||
| Preferred stock, |
|
- |
|
|
- |
|
||
| Common stock, |
|
9 |
|
|
9 |
|
||
| Additional paid-in capital |
|
1,261,940 |
|
|
1,104,522 |
|
||
| Accumulated other comprehensive income |
|
21,977 |
|
|
30,944 |
|
||
| Noncontrolling interest |
|
2,213 |
|
|
2,259 |
|
||
| Retained earnings (deficit) |
|
(26,276 |
) |
|
576 |
|
||
| Total equity |
|
1,259,863 |
|
|
1,138,310 |
|
||
| Total Liabilities and Equity | $ |
2,451,634 |
|
$ |
2,198,587 |
|
||
Four Corners Property Trust FFO and AFFO (Unaudited) (In thousands, except share and per share data) |
||||||||||||||||
| Three Months Ended December 31, |
Twelve Months Ended December 31, |
|||||||||||||||
2023 |
2022 |
2023 |
2022 |
|||||||||||||
| Funds from operations (FFO): | ||||||||||||||||
| Net income | $ |
24,459 |
|
$ |
22,900 |
|
$ |
95,462 |
|
$ |
97,908 |
|
||||
| Depreciation and amortization |
|
13,284 |
|
|
11,020 |
|
|
50,592 |
|
|
41,342 |
|
||||
| Realized gain on sales of real estate |
|
(288 |
) |
|
(555 |
) |
|
(2,341 |
) |
|
(8,139 |
) |
||||
| FFO (as defined by NAREIT) | $ |
37,455 |
|
$ |
33,365 |
|
$ |
143,713 |
|
$ |
131,111 |
|
||||
| Straight-line rental revenue |
|
(1,165 |
) |
|
(1,433 |
) |
|
(5,523 |
) |
|
(6,372 |
) |
||||
| Deferred income tax benefit (1) |
|
(27 |
) |
|
(68 |
) |
|
(259 |
) |
|
(125 |
) |
||||
| Stock-based compensation |
|
1,473 |
|
|
1,239 |
|
|
6,271 |
|
|
4,978 |
|
||||
| Non-cash amortization of deferred financing costs |
|
592 |
|
|
644 |
|
|
2,311 |
|
|
2,104 |
|
||||
| Non-real estate investment depreciation |
|
36 |
|
|
31 |
|
|
139 |
|
|
129 |
|
||||
| Other non-cash revenue adjustments |
|
551 |
|
|
551 |
|
|
2,061 |
|
|
2,151 |
|
||||
| Adjusted Funds from Operations (AFFO) | $ |
38,915 |
|
$ |
34,329 |
|
$ |
148,713 |
|
$ |
133,976 |
|
||||
| Fully diluted shares outstanding (2) |
|
90,817,925 |
|
|
84,304,767 |
|
|
88,861,587 |
|
|
81,921,624 |
|
||||
| FFO per diluted share | $ |
0.41 |
|
$ |
0.40 |
|
$ |
1.62 |
|
$ |
1.60 |
|
||||
| AFFO per diluted share | $ |
0.43 |
|
$ |
0.41 |
|
$ |
1.67 |
|
$ |
1.64 |
|
||||
(1) |
Amount represents non-cash deferred income tax benefit recognized at the Kerrow Restaurant Business | |
(2) |
Assumes the issuance of common shares for OP units held by non-controlling interest. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240214609657/en/
FCPT
Bill Lenehan, 415-965-8031
CEO
Gerry Morgan, 415-965-8032
CFO
Source: Four Corners Property Trust, Inc.
FAQ
What are the financial results announced by FCPT for the fourth quarter of 2023?
How did FCPT's AFFO per diluted share perform for the fourth quarter of 2023?
What was FCPT's dividend declaration for the fourth quarter of 2023?
How many properties were in FCPT's rental portfolio as of December 31, 2023?
What was the total outstanding debt of FCPT as of December 31, 2023?
