NETSTREIT Reports Fourth Quarter and Full Year 2024 Financial and Operating Results
NETSTREIT (NYSE: NTST) reported its Q4 and full-year 2024 financial results, posting a net loss of $(0.07) and Adjusted Funds from Operations (AFFO) of $0.32 per diluted share for Q4. The company achieved record investment activity of $195.1 million at a 7.4% blended cash yield in Q4, along with record dispositions of $59.3 million.
In January 2025, NETSTREIT secured $275.0 million in additional financing commitments, including a new $175.0 million senior unsecured term loan and an increased $500.0 million revolving credit facility. The company introduced its 2025 AFFO per share guidance range of $1.27 to $1.30 and expects net investment activity between $75.0-125.0 million.
The Board declared a quarterly cash dividend of $0.21 per share for Q1 2025, representing an annualized increase of $0.02 per share over the prior year.
NETSTREIT (NYSE: NTST) ha riportato i risultati finanziari del quarto trimestre e dell'intero anno 2024, registrando una perdita netta di $(0.07) e Fondi Regolati da Operazioni (AFFO) di $0.32 per azione diluita nel Q4. L'azienda ha raggiunto un'attività di investimento record di $195.1 milioni con un rendimento in contante misto del 7.4% nel Q4, insieme a dismissioni record di $59.3 milioni.
Nel gennaio 2025, NETSTREIT ha ottenuto $275.0 milioni in impegni di finanziamento aggiuntivi, inclusi un nuovo prestito senior non garantito di $175.0 milioni e un aumento della linea di credito revolving a $500.0 milioni. L'azienda ha presentato la sua guida per l'AFFO per azione del 2025, con un intervallo compreso tra $1.27 e $1.30 e prevede un'attività di investimento netto tra $75.0-125.0 milioni.
Il Consiglio ha dichiarato un dividendo in contante trimestrale di $0.21 per azione per il Q1 2025, che rappresenta un aumento annualizzato di $0.02 per azione rispetto all'anno precedente.
NETSTREIT (NYSE: NTST) reportó sus resultados financieros del cuarto trimestre y del año completo 2024, registrando una pérdida neta de $(0.07) y Fondos Ajustados de Operaciones (AFFO) de $0.32 por acción diluida para el Q4. La compañía logró una actividad de inversión récord de $195.1 millones con un rendimiento de efectivo combinado del 7.4% en el Q4, junto con disposiciones récord de $59.3 millones.
En enero de 2025, NETSTREIT aseguró $275.0 millones en compromisos de financiamiento adicionales, incluyendo un nuevo préstamo a plazo senior no garantizado de $175.0 millones y una línea de crédito rotativa aumentada de $500.0 millones. La compañía presentó su guía para el AFFO por acción de 2025, que oscila entre $1.27 y $1.30 y espera una actividad de inversión neta entre $75.0-125.0 millones.
La Junta declaró un dividendo en efectivo trimestral de $0.21 por acción para el Q1 2025, lo que representa un aumento anualizado de $0.02 por acción respecto al año anterior.
NETSTREIT (NYSE: NTST)는 2024년 4분기 및 연간 재무 결과를 보고하며, 4분기 동안 주당 희석 손실 $(0.07)과 조정 운영 자금(AFFO) $0.32를 기록했습니다. 회사는 4분기에 7.4% 혼합 현금 수익률로 $195.1 백만의 기록적인 투자 활동을 달성했으며, $59.3 백만의 기록적인 처분도 이루어졌습니다.
2025년 1월, NETSTREIT는 $275.0 백만의 추가 자금 조달 약정을 확보했으며, 여기에는 새로운 $175.0 백만의 고위험 무담보 대출과 $500.0 백만의 증가된 회전 신용 시설이 포함됩니다. 회사는 2025년 주당 AFFO 가이던스를 $1.27에서 $1.30 사이로 제시했으며, 순 투자 활동은 $75.0-125.0 백만 사이로 예상하고 있습니다.
이사회는 2025년 1분기 주당 $0.21의 분기 현금 배당금을 선언했으며, 이는 전년도 대비 주당 $0.02의 연간 증가를 나타냅니다.
NETSTREIT (NYSE: NTST) a annoncé ses résultats financiers du quatrième trimestre et de l'année 2024, affichant une perte nette de $(0.07) et des Fonds Ajustés d'Exploitation (AFFO) de $0.32 par action diluée pour le Q4. L'entreprise a réalisé une activité d'investissement record de $195.1 millions avec un rendement en espèces mixte de 7.4% au Q4, ainsi que des cessions record de $59.3 millions.
En janvier 2025, NETSTREIT a sécurisé $275.0 millions d'engagements de financement supplémentaires, y compris un nouveau prêt à terme senior non garanti de $175.0 millions et une ligne de crédit revolving augmentée de $500.0 millions. L'entreprise a introduit sa prévision d'AFFO par action pour 2025 dans une fourchette de $1.27 à $1.30 et s'attend à une activité d'investissement nette entre $75.0-125.0 millions.
Le Conseil a déclaré un dividende en espèces trimestriel de $0.21 par action pour le Q1 2025, représentant une augmentation annualisée de $0.02 par action par rapport à l'année précédente.
NETSTREIT (NYSE: NTST) hat seine finanziellen Ergebnisse für das vierte Quartal und das gesamte Jahr 2024 veröffentlicht, mit einem Nettverlust von $(0.07) und bereinigten Mitteln aus Betriebstätigkeit (AFFO) von $0.32 pro verwässerter Aktie im Q4. Das Unternehmen erzielte im Q4 eine Rekordinvestitionstätigkeit von $195.1 Millionen bei einer gemischten Barrendite von 7.4%, sowie Rekordverkäufe von $59.3 Millionen.
Im Januar 2025 sicherte sich NETSTREIT $275.0 Millionen an zusätzlichen Finanzierungszusagen, einschließlich eines neuen unbesicherten langfristigen Darlehens über $175.0 Millionen und einer erhöhten revolvierenden Kreditlinie von $500.0 Millionen. Das Unternehmen gab seine Prognose für das AFFO pro Aktie für 2025 in einer Spanne von $1.27 bis $1.30 bekannt und erwartet eine Nettoinvestitionstätigkeit zwischen $75.0-125.0 Millionen.
Der Vorstand erklärte eine vierteljährliche Bardividende von $0.21 pro Aktie für das Q1 2025, was eine annualisierte Erhöhung von $0.02 pro Aktie im Vergleich zum Vorjahr darstellt.
- Record Q4 investment activity of $195.1M at 7.4% cash yield
- Secured $275M in additional financing commitments
- Increased revolving credit facility to $500M from $400M
- Dividend increase of $0.02 per share annually
- Q4 net loss of $(0.07) per share
- Reduced investment activity guidance for 2025 ($75-125M) compared to Q4 2024 performance ($195.1M)
Insights
The Q4 2024 results reveal NETSTREIT's strategic positioning in the net lease REIT sector, with several notable developments worth examining in detail:
Investment Activity and Portfolio Management: The record $195.1M investment at a 7.4% cash yield demonstrates strong deal execution in a high-rate environment, where typical net lease yields have been ranging from 6-7%. The simultaneous disposition of $59.3M in assets shows active portfolio management and capital recycling, which is important for maintaining portfolio quality and optimizing returns.
Financial Structure Enhancement: The January 2025 financing package is particularly strategic, featuring:
- A new
$175M term loan fixed at5.12% through 2030 - An expanded
$500M revolving facility - Improved covenant terms aligned with investment-grade aspirations
Forward-Looking Metrics: The 2025 AFFO guidance of
Portfolio Strategy: The focus on tenant diversity and internal growth profile enhancement indicates a defensive positioning strategy. This approach, combined with the recent financing activities, suggests management is preparing for potential market volatility while maintaining flexibility for opportunistic investments.
– Net loss of
– Completed Gross Investment Activity of
– Introduces 2025 AFFO Per Share Guidance of
– Closed
“I am pleased to report that NETSTREIT delivered solid 2024 results, which included a Company record
FOURTH QUARTER AND FULL YEAR 2024 HIGHLIGHTS
The following table summarizes the Company's select financial results1 for the three months and year ended December 31, 2024.
|
Three Months Ended December 31, |
||||||||
|
|
2024 |
|
|
|
2023 |
|
% Change |
|
|
(Unaudited) |
||||||||
Net (Loss) per Diluted Share |
$ |
(0.07 |
) |
$ |
0.03 |
(333.3 |
)% |
||
Funds from Operations per Diluted Share |
$ |
0.32 |
|
$ |
0.30 |
6.7 |
% |
||
Core Funds from Operations per Diluted Share |
$ |
0.32 |
|
$ |
0.30 |
6.7 |
% |
||
Adjusted Funds from Operations per Diluted Share |
$ |
0.32 |
|
$ |
0.31 |
3.2 |
% |
||
|
Year Ended December 31, |
||||||||
|
|
2024 |
|
|
|
2023 |
|
% Change |
|
|
(Unaudited) |
||||||||
Net (Loss) per Diluted Share |
$ |
(0.16 |
) |
$ |
0.11 |
(245.5 |
)% |
||
Funds from Operations per Diluted Share |
$ |
1.20 |
|
$ |
1.18 |
1.7 |
% |
||
Core Funds from Operations per Diluted Share |
$ |
1.26 |
|
$ |
1.19 |
5.9 |
% |
||
Adjusted Funds from Operations per Diluted Share |
$ |
1.26 |
|
$ |
1.22 |
3.3 |
% |
||
| 1. | Funds from operations ("FFO"), core funds from operations ("Core FFO"), and adjusted funds from operations ("AFFO") are non-GAAP financial measures. See "Non-GAAP Financial Measures." |
INVESTMENT ACTIVITY
The following tables summarize the Company's investment, disposition, and loan repayment activities (dollars in thousands) for the three months and year ended December 31, 2024.
|
Three Months Ended December 31, 2024 |
|
Year Ended December 31, 2024 |
||||||||
|
Number of Investments |
|
Amount |
|
Number of Investments |
|
Amount |
||||
Investments |
52 |
|
$ |
195,079 |
|
|
155 |
|
$ |
591,574 |
|
Dispositions |
30 |
|
|
59,337 |
|
|
56 |
|
|
117,744 |
|
Loan Repayments |
6 |
|
|
13,627 |
|
|
11 |
|
|
24,808 |
|
Net Investment Activity |
|
|
$ |
122,115 |
|
|
|
|
$ |
449,023 |
|
|
|
|
|
|
|
|
|
||||
Investment Activity |
|
|
|
|
|
|
|
||||
Cash Yield |
|
|
|
7.4 |
% |
|
|
|
|
7.5 |
% |
% of ABR derived from Investment Grade Tenants |
|
|
|
34.7 |
% |
|
|
|
|
46.6 |
% |
% of ABR derived from Investment Grade Profile Tenants |
|
|
|
13.9 |
% |
|
|
|
|
9.0 |
% |
Weighted Average Lease Term (years) |
|
|
|
14.0 |
|
|
|
|
|
13.6 |
|
|
|
|
|
|
|
|
|
||||
Disposition Activity |
|
|
|
|
|
|
|
||||
Cash Yield |
|
|
|
7.1 |
% |
|
|
|
|
7.0 |
% |
Weighted Average Lease Term (years) |
|
|
|
11.4 |
|
|
|
|
|
10.8 |
|
|
|
|
|
|
|
|
|
||||
Loan Repayments |
|
|
|
|
|
|
|
||||
Cash Yield |
|
|
|
9.3 |
% |
|
|
|
|
9.2 |
% |
The following table summarizes the Company's ongoing development projects and estimated development costs (dollars in thousands) as of and for the three months ended December 31, 2024.
Developments |
Three Months Ended December 31, 2024 |
|
Amount Funded During the Quarter |
$ |
1,789 |
|
|
|
|
As of December 31, 2024 |
|
Number of Developments |
|
5 |
Amount Funded to Date |
$ |
7,883 |
Estimated Funding Remaining on Developments |
|
6,718 |
Total Estimated Development Cost |
$ |
14,601 |
PORTFOLIO UPDATE
The following table summarizes the Company's real estate portfolio (weighted by ABR, dollars in thousands) as of December 31, 2024.
|
As of December 31, 2024 |
||
Number of Investments |
|
687 |
|
ABR |
$ |
165,070 |
|
States |
|
45 |
|
Square Feet |
|
12,609,612 |
|
Tenants |
|
98 |
|
Industries |
|
26 |
|
Occupancy |
|
99.9 |
% |
Weighted Average Lease Term (years) |
|
9.8 |
|
Investment Grade % |
|
55.8 |
% |
Investment Grade Profile % |
|
15.0 |
% |
CAPITAL MARKETS AND BALANCE SHEET
The following tables summarize the Company's leverage, balance sheet, ATM sales, and settlement of our forward equity offerings (dollars in thousands, except per share data) as of and for the three months ended December 31, 2024.
Leverage |
As of December 31, 2024 |
|
Net Debt / Annualized Adjusted EBITDAre |
5.8x |
|
Adjusted Net Debt / Annualized Adjusted EBITDAre |
4.5x |
|
|
|
|
Forward Equity Settlement Activity |
As of December 31, 2024 |
|
Shares Settled During Quarter |
|
— |
Weighted Average Price Per Share (Gross) |
$ |
— |
Net Value of Settled Forward Equity as of December 31, 2024 |
$ |
— |
|
|
|
ATM Program |
As of December 31, 2024 |
|
Shares Sold During Quarter |
|
— |
Weighted Average Price Per Share (Gross) |
$ |
— |
ATM Program Total Capacity |
$ |
300,000 |
ATM Capacity Remaining as of December 31, 2024 |
$ |
297,387 |
|
|
|
Unsettled Forward Equity |
As of December 31, 2024 |
|
Shares Unsettled as of December 31, 2024 |
|
10,735,647 |
Weighted Average Price Per Share (Gross) |
$ |
17.93 |
Net Value of Unsettled Forward Equity as of December 31, 2024 |
$ |
185,063 |
SUBSEQUENT DEBT ACTIVITY
On January 15, 2025, the Company closed on
In addition, the Company extended the maturity date of the existing
The following tables summarize the terms of the 2030 Term Loan B (dollars in thousands), and the Company's proforma liquidity as of December 31, 2024.
2030 Term Loan B |
|
||
Fully Extended Maturity Date |
|
January 2030 |
|
Maximum Available Principal (Fully Drawn) |
$ |
175,000 |
|
All-In Fixed Interest Rate |
|
5.12 |
% |
|
|
||
Proforma Liquidity |
As of December 31, 2024 |
||
Unused unsecured revolver capacity(1) |
$ |
435,850 |
|
Cash, cash equivalents and restricted cash |
|
14,320 |
|
Net value of unsettled forward equity |
|
185,063 |
|
Total Proforma Liquidity |
$ |
635,233 |
|
| 1. |
Assumes the entry into the 2030 Term Loan B, which was used to pay down our Revolving Facility, and the concurrent increase in our revolver capacity to |
DIVIDEND
On February 21, 2025, the Company’s Board of Directors declared a quarterly cash dividend of
2025 GUIDANCE
The Company is initiating its full year 2025 AFFO per share guidance in the range of
The Company's 2025 guidance is based on a number of assumptions that are subject to change and many of which are outside the Company's control. If actual results vary from these assumptions, the Company's expectations may change. There can be no assurance that the Company will achieve these results.
AFFO is a non-GAAP financial measure. The Company does not provide a reconciliation of such forward-looking non-GAAP measure to the most directly comparable financial measures calculated and presented in accordance with GAAP because to do so would be potentially misleading and not practical given the difficulty of projecting event driven transactional and other non-core operating items in any future period. The magnitude of these items, however, may be significant.
EARNINGS CONFERENCE CALL
A conference call will be held on Tuesday, February 25, 2025 at 11:00 AM ET. During the conference call the Company’s officers will review fourth quarter and full year 2024 performance, discuss recent events, and conduct a question and answer period.
The webcast will be accessible on the “Investor Relations” section of the Company’s website at www.NETSTREIT.com. To listen to the live webcast, please go to the site at least 15 minutes prior to the scheduled start time to register, as well as download and install any necessary audio software.
The conference call can also be accessed by dialing 1-877-451-6152 for domestic callers or 1-201-389-0879 for international callers. A dial-in replay will be available starting shortly after the call until March 4, 2025, which can be accessed by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for this dial-in replay is 13751303.
SUPPLEMENTAL PACKAGE
The Company’s supplemental package will be available prior to the conference call in the Investor Relations section of the Company’s website at www.investors.netstreit.com.
About NETSTREIT Corp.
NETSTREIT Corp. is an internally managed real estate investment trust (REIT) based in
NON-GAAP FINANCIAL MEASURES
This press release contains non-GAAP financial measures, including FFO, Core FFO, AFFO, EBITDA, EBITDAre, Adjusted EBITDAre, Annualized Adjusted EBITDAre, Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI Estimated Run Rate, Total Property-Level Cash NOI Estimated Run Rate, Net Debt and Adjusted Net Debt. A reconciliation of each non-GAAP financial measure to the most comparable GAAP measure, and definitions of each non-GAAP measure, are included below.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements concerning our business and growth strategies, investment, financing and leasing activities, including estimated development costs, trends in our business, including trends in the market for single-tenant, retail commercial real estate. Words such as “expects,” “anticipates,” “intends,” “plans,” “likely,” “will,” “believes,” “seeks,” “estimates,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results of operations or plans expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore such statements included in this press release may not prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be achieved. For a further discussion of these and other factors that could impact future results, performance or transactions, see the information under the heading “Risk Factors” in our Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on February 14, 2024 and other reports filed with the SEC from time to time. Forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this press release. New risks and uncertainties may arise over time and it is not possible for us to predict those events or how they may affect us. Many of the risks identified herein and in our periodic reports have been and will continue to be heightened as a result of the ongoing and numerous adverse effects arising from macroeconomic conditions, including inflation, interest rates and instability in the banking system. We expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by law.
NETSTREIT CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share data) (Unaudited) |
|||||||
|
December 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Assets |
|
|
|
||||
Real estate, at cost: |
|
|
|
||||
Land |
$ |
571,272 |
|
|
$ |
460,896 |
|
Buildings and improvements |
|
1,400,393 |
|
|
|
1,149,809 |
|
Total real estate, at cost |
|
1,971,665 |
|
|
|
1,610,705 |
|
Less accumulated depreciation |
|
(143,422 |
) |
|
|
(101,210 |
) |
Property under development |
|
6,118 |
|
|
|
29,198 |
|
Real estate held for investment, net |
|
1,834,361 |
|
|
|
1,538,693 |
|
Assets held for sale |
|
48,637 |
|
|
|
52,451 |
|
Mortgage loans receivable, net |
|
139,409 |
|
|
|
114,472 |
|
Cash, cash equivalents, and restricted cash |
|
14,320 |
|
|
|
29,929 |
|
Lease intangible assets, net |
|
164,392 |
|
|
|
161,354 |
|
Other assets, net |
|
58,227 |
|
|
|
49,337 |
|
Total assets |
$ |
2,259,346 |
|
|
$ |
1,946,236 |
|
Liabilities and equity |
|
|
|
||||
Liabilities: |
|
|
|
||||
Term loans, net |
$ |
622,608 |
|
|
$ |
521,912 |
|
Revolving credit facility |
|
239,000 |
|
|
|
80,000 |
|
Mortgage note payable, net |
|
7,853 |
|
|
|
7,883 |
|
Lease intangible liabilities, net |
|
20,177 |
|
|
|
25,353 |
|
Liabilities related to assets held for sale |
|
1,912 |
|
|
|
1,158 |
|
Accounts payable, accrued expenses, and other liabilities |
|
29,664 |
|
|
|
36,498 |
|
Total liabilities |
|
921,214 |
|
|
|
672,804 |
|
Commitments and contingencies |
|
|
|
||||
Equity: |
|
|
|
||||
Stockholders’ equity |
|
|
|
||||
Common stock, |
|
816 |
|
|
|
732 |
|
Additional paid-in capital |
|
1,507,995 |
|
|
|
1,367,505 |
|
Distributions in excess of retained earnings |
|
(188,046 |
) |
|
|
(112,276 |
) |
Accumulated other comprehensive income |
|
10,206 |
|
|
|
8,943 |
|
Total stockholders’ equity |
|
1,330,971 |
|
|
|
1,264,904 |
|
Noncontrolling interests |
|
7,161 |
|
|
|
8,528 |
|
Total equity |
|
1,338,132 |
|
|
|
1,273,432 |
|
Total liabilities and equity |
$ |
2,259,346 |
|
|
$ |
1,946,236 |
|
NETSTREIT CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share data) (Unaudited) |
|||||||||||
|
Year Ended December 31, |
||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues |
|
|
|
|
|
||||||
Rental revenue (including reimbursable) |
$ |
150,823 |
|
|
$ |
123,967 |
|
|
$ |
93,934 |
|
Interest income on loans receivable |
|
11,561 |
|
|
|
7,388 |
|
|
|
2,345 |
|
Other revenue |
|
400 |
|
|
|
550 |
|
|
|
— |
|
Total revenues |
|
162,784 |
|
|
|
131,905 |
|
|
|
96,279 |
|
Operating expenses |
|
|
|
|
|
||||||
Property |
|
17,422 |
|
|
|
16,413 |
|
|
|
11,695 |
|
General and administrative |
|
19,722 |
|
|
|
20,176 |
|
|
|
19,053 |
|
Depreciation and amortization |
|
76,871 |
|
|
|
63,677 |
|
|
|
50,075 |
|
Provisions for impairment |
|
29,969 |
|
|
|
7,083 |
|
|
|
1,114 |
|
Transaction costs |
|
359 |
|
|
|
456 |
|
|
|
839 |
|
Total operating expenses |
|
144,343 |
|
|
|
107,805 |
|
|
|
82,776 |
|
Other (expense) income |
|
|
|
|
|
||||||
Interest expense, net |
|
(30,324 |
) |
|
|
(19,058 |
) |
|
|
(9,181 |
) |
Gain on sales of real estate, net |
|
1,876 |
|
|
|
1,175 |
|
|
|
4,148 |
|
Loss on debt extinguishment |
|
— |
|
|
|
(128 |
) |
|
|
— |
|
Other (expense) income, net |
|
(1,944 |
) |
|
|
752 |
|
|
|
131 |
|
Total other expense, net |
|
(30,392 |
) |
|
|
(17,259 |
) |
|
|
(4,902 |
) |
Net (loss) income before income taxes |
|
(11,951 |
) |
|
|
6,841 |
|
|
|
8,601 |
|
Income tax (expense) benefit |
|
(49 |
) |
|
|
49 |
|
|
|
(396 |
) |
Net (loss) income |
|
(12,000 |
) |
|
|
6,890 |
|
|
|
8,205 |
|
Net (loss) income attributable to noncontrolling interests |
|
(63 |
) |
|
|
53 |
|
|
|
88 |
|
Net (loss) income attributable to common stockholders |
$ |
(11,937 |
) |
|
$ |
6,837 |
|
|
$ |
8,117 |
|
Amounts available to common stockholders per common share: |
|
|
|
|
|
||||||
Basic |
$ |
(0.16 |
) |
|
$ |
0.11 |
|
|
$ |
0.16 |
|
Diluted |
$ |
(0.16 |
) |
|
$ |
0.11 |
|
|
$ |
0.16 |
|
Weighted average common shares: |
|
|
|
|
|
||||||
Basic |
|
76,517,767 |
|
|
|
63,922,973 |
|
|
|
49,517,977 |
|
Diluted |
|
76,517,767 |
|
|
|
64,665,439 |
|
|
|
50,431,822 |
|
NETSTREIT CORP. AND SUBSIDIARIES RECONCILIATION OF NET (LOSS) INCOME TO FFO, CORE FFO AND ADJUSTED FFO (In thousands, except share and per share data) (Unaudited) |
|||||||
|
Year Ended December 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Net (loss) income |
$ |
(12,000 |
) |
|
$ |
6,890 |
|
Depreciation and amortization of real estate |
|
76,560 |
|
|
|
63,379 |
|
Provisions for impairment |
|
29,969 |
|
|
|
7,083 |
|
Gain on sales of real estate, net |
|
(1,876 |
) |
|
|
(1,175 |
) |
FFO |
|
92,653 |
|
|
|
76,177 |
|
Adjustments: |
|
|
|
||||
Non-recurring executive transition costs, severance and related charges |
|
1,643 |
|
|
|
362 |
|
Loss on debt extinguishment and other related costs |
|
— |
|
|
|
223 |
|
Other non-recurring loss (gain), net |
|
2,934 |
|
|
|
(78 |
) |
Core FFO |
|
97,230 |
|
|
|
76,684 |
|
Adjustments: |
|
|
|
||||
Straight-line rent adjustments |
|
(2,949 |
) |
|
|
(1,163 |
) |
Amortization of deferred financing costs |
|
2,230 |
|
|
|
1,730 |
|
Amortization of above/below-market assumed debt |
|
114 |
|
|
|
114 |
|
Amortization of loan origination costs and discounts |
|
(365 |
) |
|
|
163 |
|
Amortization of lease-related intangibles |
|
(458 |
) |
|
|
(611 |
) |
Earned development interest |
|
1,072 |
|
|
|
515 |
|
Capitalized interest expense |
|
(806 |
) |
|
|
(1,060 |
) |
Non-cash interest expense |
|
(3,789 |
) |
|
|
(2,124 |
) |
Non-cash compensation expense |
|
5,126 |
|
|
|
4,822 |
|
AFFO |
$ |
97,405 |
|
|
$ |
79,070 |
|
|
|
|
|
||||
Weighted average common shares outstanding, basic |
|
76,517,767 |
|
|
|
63,922,973 |
|
Weighted average operating partnership units outstanding |
|
444,435 |
|
|
|
501,751 |
|
Weighted average dilutive securities |
|
123,992 |
|
|
|
165,420 |
|
Weighted average unsettled shares under forwards |
|
233,606 |
|
|
|
75,295 |
|
Weighted average common shares outstanding, diluted |
|
77,319,800 |
|
|
|
64,665,439 |
|
|
|
|
|
||||
FFO per common share, diluted |
$ |
1.20 |
|
|
$ |
1.18 |
|
Core FFO per common share, diluted |
$ |
1.26 |
|
|
$ |
1.19 |
|
AFFO per common share, diluted |
$ |
1.26 |
|
|
$ |
1.22 |
|
NETSTREIT CORP. AND SUBSIDIARIES RECONCILIATION OF NET (LOSS) INCOME TO EBITDA, EBITDAre AND ADJUSTED EBITDAre (In thousands) (Unaudited) |
|||||||
|
Three Months Ended December 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Net (loss) income |
$ |
(5,424 |
) |
|
$ |
1,962 |
|
Depreciation and amortization of real estate |
|
20,275 |
|
|
|
17,000 |
|
Amortization of lease-related intangibles |
|
(95 |
) |
|
|
(93 |
) |
Non-real estate depreciation and amortization |
|
75 |
|
|
|
78 |
|
Interest expense, net |
|
8,576 |
|
|
|
5,646 |
|
Income tax expense |
|
18 |
|
|
|
10 |
|
Amortization of loan origination costs and discounts |
|
(123 |
) |
|
|
80 |
|
EBITDA |
|
23,302 |
|
|
|
24,683 |
|
Adjustments: |
|
|
|
||||
Provisions for impairment |
|
12,633 |
|
|
|
2,709 |
|
Gain on sales of real estate, net |
|
(1,002 |
) |
|
|
(506 |
) |
EBITDAre |
|
34,933 |
|
|
|
26,886 |
|
Adjustments: |
|
|
|
||||
Straight-line rent adjustments |
|
(1,120 |
) |
|
|
(456 |
) |
Non-recurring executive transition costs, severance and related charges |
|
148 |
|
|
|
86 |
|
Other non-recurring gain, net |
|
(142 |
) |
|
|
(31 |
) |
Other non-recurring expenses, net |
|
438 |
|
|
|
— |
|
Transaction costs |
|
158 |
|
|
|
189 |
|
Non-cash compensation expense |
|
999 |
|
|
|
1,264 |
|
Lease termination fees |
|
(400 |
) |
|
|
— |
|
Adjustment for construction in process (1) |
|
152 |
|
|
|
719 |
|
Adjustment for intraquarter investment activities (2) |
|
1,910 |
|
|
|
820 |
|
Adjusted EBITDAre |
$ |
37,076 |
|
|
$ |
29,477 |
|
Annualized Adjusted EBITDAre(3) |
$ |
148,304 |
|
|
|
||
|
|
|
|
||||
Net Debt |
As of December 31, 2024 |
|
|
||||
Principal amount of total debt |
$ |
872,205 |
|
|
|
||
Less: Cash, cash equivalents and restricted cash |
|
(14,320 |
) |
|
|
||
Net Debt |
|
857,885 |
|
|
|
||
Less: Net value of unsettled forward equity(4) |
|
(185,063 |
) |
|
|
||
Adjusted Net Debt |
$ |
672,822 |
|
|
|
||
|
|
|
|
||||
Leverage |
|
|
|
||||
Net Debt / Annualized Adjusted EBITDAre |
5.8 x |
|
|
||||
Adjusted Net Debt / Annualized Adjusted EBITDAre |
4.5 x |
|
|
||||
1. |
Adjustment reflects the estimated cash yield on developments in process as of December 31, 2024. |
2. |
Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024. |
3. |
We calculate Annualized Adjusted EBITDAre by multiplying Adjusted EBITDAre by four. |
4. |
Reflects 10,735,647 of unsettled forward equity shares at the December 31, 2024, available weighted average net settlement price of |
NETSTREIT CORP. AND SUBSIDIARIES RECONCILIATION OF NET (LOSS) INCOME TO NOI AND CASH NOI (in thousands) (Unaudited) |
|||||||
|
Three Months Ended December 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Net (loss) income |
$ |
(5,424 |
) |
|
$ |
1,962 |
|
General and administrative |
|
4,456 |
|
|
|
4,876 |
|
Depreciation and amortization |
|
20,349 |
|
|
|
17,078 |
|
Provisions for impairment |
|
12,633 |
|
|
|
2,709 |
|
Transaction costs |
|
158 |
|
|
|
189 |
|
Interest expense, net |
|
8,576 |
|
|
|
5,646 |
|
Gain on sales of real estate, net |
|
(1,002 |
) |
|
|
(506 |
) |
Income tax expense |
|
18 |
|
|
|
10 |
|
Amortization of loan origination costs and discounts |
|
(123 |
) |
|
|
80 |
|
Interest income on mortgage loans receivable |
|
(3,103 |
) |
|
|
(2,243 |
) |
Lease termination fees |
|
(400 |
) |
|
|
— |
|
Other expense, net |
|
103 |
|
|
|
(166 |
) |
Property-Level NOI |
|
36,241 |
|
|
|
29,635 |
|
Straight-line rent adjustments |
|
(1,120 |
) |
|
|
(456 |
) |
Amortization of lease-related intangibles |
|
(95 |
) |
|
|
(93 |
) |
Property-Level Cash NOI |
$ |
35,026 |
|
|
$ |
29,086 |
|
Adjustment for intraquarter acquisitions, dispositions, and completed development(1) |
|
1,817 |
|
|
|
||
Property-Level Cash NOI Estimated Run Rate |
|
36,843 |
|
|
|
||
Interest income on mortgage loans receivable |
|
3,103 |
|
|
|
||
Adjustments for intraquarter mortgage loan activity(2) |
|
93 |
|
|
|
||
Total Cash NOI - Estimated Run Rate |
$ |
40,039 |
|
|
|
||
| 1. | Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024. |
| 2. | Adjustment assumes all loan activity completed during the three months ended December 31, 2024, had occurred on October 1, 2024. |
NON-GAAP FINANCIAL MEASURES
FFO, Core FFO, and AFFO
The National Association of Real Estate Investment Trusts ("NAREIT"), an industry trade group, has promulgated a widely accepted non-GAAP financial measure of operating performance known as FFO. Our FFO is net (loss) income in accordance with GAAP, excluding gains (or losses) resulting from dispositions of properties, plus depreciation and amortization and impairment charges on depreciable real property.
Core FFO is a non-GAAP financial measure defined as FFO adjusted to remove the effect of unusual and non-recurring items that are not expected to impact our operating performance or operations on an ongoing basis. These include non-recurring executive transition costs, severance and related charges, non-recurring other loss (gain), net, and loss on debt extinguishments and other related costs.
AFFO is a non-GAAP financial measure defined as Core FFO adjusted for GAAP net (loss) income related to non-cash revenues and expenses, such as straight-line rent, amortization of above- and below-market lease-related intangibles, amortization of lease incentives, capitalized interest expense, earned development interest, non-cash interest expense, non-cash compensation expense, amortization of deferred financing costs, amortization of above/below-market assumed debt, and amortization of loan origination costs.
Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. In fact, real estate values historically have risen or fallen with market conditions. FFO is intended to be a standard supplemental measure of operating performance that excludes historical cost depreciation and valuation adjustments from net (loss) income. We consider FFO to be useful in evaluating potential property acquisitions and measuring operating performance.
We further consider FFO, Core FFO and AFFO to be useful in determining funds available for payment of distributions. FFO, Core FFO and AFFO do not represent net (loss) income or cash flows from operations as defined by GAAP. You should not consider FFO, Core FFO and AFFO to be alternatives to net (loss) income as a reliable measure of our operating performance nor should you consider FFO, Core FFO and AFFO to be alternatives to cash flows from operating, investing or financing activities (as defined by GAAP) as measures of liquidity.
FFO, Core FFO and AFFO do not measure whether cash flow is sufficient to fund our cash needs, including principal amortization, capital improvements and distributions to stockholders. FFO, Core FFO and AFFO do not represent cash flows from operating, investing or financing activities as defined by GAAP. Further, FFO, Core FFO and AFFO as disclosed by other REITs might not be comparable to our calculations of FFO, Core FFO and AFFO.
EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre
We compute EBITDA as earnings before interest expense, income tax expense, and depreciation and amortization. In 2017, NAREIT issued a white paper recommending that companies that report EBITDA also report EBITDAre. We compute EBITDAre in accordance with the definition adopted by NAREIT. NAREIT defines EBITDAre as EBITDA (as defined above) excluding gains (or losses) from the sales of depreciable property and impairment charges on depreciable real property.
Adjusted EBITDAre is a non-GAAP financial measure defined as EBITDAre further adjusted to exclude straight-line rent, non-cash compensation expense, non-recurring executive transition costs, severance and related charges, loss on debt extinguishment and other related costs, other non-recurring loss (gain), net, other non-recurring expenses (income), transaction costs, lease termination fees, adjustment for construction in process, and adjustment for intraquarter activities.
Annualized Adjusted EBITDAre is Adjusted EBITDAre multiplied by four.
We present EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre as they are measures commonly used in our industry. We believe that these measures are useful to investors and analysts because they provide supplemental information concerning our operating performance, exclusive of certain non-cash items and other costs. We use EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre as measures of our operating performance and not as measures of liquidity.
EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre do not include all items of revenue and expense included in net income, they do not represent cash generated from operating activities and they are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Additionally, our computation of EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs.
Net Debt and Adjusted Net Debt
We calculate our Net Debt as our principal amount of total debt outstanding excluding deferred financing costs, net discounts and debt issuance costs less cash, cash equivalents and restricted cash available for future investment. We believe excluding cash, cash equivalents and restricted cash available for future investment from our principal amount, all of which could be used to repay debt, provides an estimate on the net contractual amount of borrowed capital to be repaid. We believe these adjustments are additional beneficial disclosures to investors and analysts.
We further adjust Net Debt by the net value of unsettled forward equity as of period end to derive Adjusted Net Debt.
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are non-GAAP financial measures which we use to assess our operating results. We compute Property-Level NOI as net (loss) income (computed in accordance with GAAP), excluding general and administrative expenses, interest expense (or income), income tax expense, amortization of loan origination costs and discounts, transaction costs, depreciation and amortization, gains (or losses) on sales of depreciable property, real estate impairment losses, interest income on mortgage loans receivable, loss on debt extinguishment, lease termination fees, and other expense (income), net. We further adjust Property-Level NOI for non-cash revenue components of straight-line rent and amortization of lease-intangibles to derive Property-Level Cash NOI. We further adjust Property-Level Cash NOI for intraquarter acquisitions, dispositions and completed developments to derive Property-Level Cash NOI - Estimated Run Rate. We further adjust Property-Level Cash NOI - Estimated Run Rate for interest income on mortgage loans receivable and intraquarter mortgage loan activity to derive Total Cash NOI - Estimated Run Rate. We believe Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate provide useful and relevant information because they reflect only those income and expense items that are incurred at the property level and present such items on an unlevered basis.
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are not measurements of financial performance under GAAP, and may not be comparable to similarly titled measures of other companies. You should not consider our measures as alternatives to net (loss) income or cash flows from operating activities determined in accordance with GAAP.
OTHER DEFINITIONS
ABR is annualized base rent as of December 31, 2024, for all leases that commenced and annualized cash interest on mortgage loans receivable in place as of that date.
Cash Yield is the annualized base rent contractually due from acquired properties and completed developments, and interest income from mortgage loans receivable, divided by the gross investment amount, gross proceeds in the case of dispositions, or loan repayment amount.
Investments are lease agreements in place at owned properties, properties that have leases associated with mortgage loans receivable, developments where rent commenced, interest earning developments, or in the case of master lease arrangements each property under the master lease is counted as a separate lease.
Investment Grade are investments, or investments that are subsidiaries of a parent entity, with a credit rating of BBB- (S&P/Fitch), Baa3 (Moody's) or NAIC2 (National Association or Insurance Commissioners) or higher.
Investment Grade Profile are investments with investment grade credit metrics (more than
Occupancy is expressed as a percentage, and is the number of leased investments divided by the total number of investments owned, excluding properties under development.
Weighted Average Lease Term is weighted by the annualized base rent, excluding lease extension options and investments associated with mortgage loans receivable.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250224345787/en/
Investor Relations
ir@netstreit.com
972-597-4825
Source: NETSTREIT Corp.
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