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FCPT Announces Fourth Quarter 2023 Financial and Operating Results

Four Corners Property Trust, Inc. (“FCPT” or the “Company”, NYSE: FCPT) today announced financial results for the three months and twelve months ended December 31, 2023.

Management Comments

“2023 was a solid acquisition year. We grew rent 14% with $333 million of high-quality acquisitions,” said Bill Lenehan. “Additionally, our portfolio continues to perform well with high rent collections and occupancy, and we start the year with low leverage. We remain disciplined allocators of capital and are finding interesting investment opportunities as we focus on building an accretive pipeline.”

Rent Collection Update

As of December 31, 2023, the Company has received rent payments representing 99.8% of its portfolio contractual base rent for the quarter ending December 31, 2023, and 99.9% for the year ending December 31, 2023.

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. Rental revenue consisted of $57.0 million in cash rents and $0.6 million of straight-line and other non-cash rent adjustments.
  • Net income attributable to common shareholders was $24.4 million for the fourth quarter, or $0.27 per diluted share. These results compare to net income attributable to common shareholders of $22.9 million for the same quarter in the prior year, or $0.27 per diluted share.
  • Net income attributable to common shareholders was $95.3 million for the twelve months ended December 31, 2023, or $1.07 per diluted share. These results compare to net income attributed to common shareholders of $97.8 million for the same twelve-month period in 2022, or $1.20 per diluted share.

Funds from Operations (FFO)

  • NAREIT-defined FFO per diluted share for the fourth quarter was $0.41, representing a $0.01 increase compared to the same quarter in 2022.
  • NAREIT-defined FFO per diluted share for the twelve months ended December 31, 2023 was $1.62, representing a $0.02 increase compared to the same twelve-month period in 2022.

Adjusted Funds from Operations (AFFO)

  • AFFO per diluted share for the fourth quarter was $0.43, representing a $0.02 per share increase compared to the same quarter in 2022.
  • AFFO per diluted share for the twelve months ended December 31, 2023 was $1.67, representing a $0.03 per share increase compared to the same twelve-month period in 2022.

General and Administrative (G&A) Expense

  • G&A expense for the fourth quarter was $5.5 million, which included $1.5 million of stock-based compensation. These results compare to G&A expense in the fourth quarter of 2022 of $5.2 million, including $1.2 million of stock-based compensation.
  • Cash G&A expense (after excluding stock-based compensation) for the fourth quarter was $4.1 million, representing 7.1% of cash rental income for the quarter.

Dividends

  • FCPT declared a dividend of $0.345 per common share for the fourth quarter of 2023.

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 at an initial weighted average cash yield of 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 representing $0.3 million of gain.

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 per share for net proceeds of $25.2 million.

Liquidity

  • At December 31, 2023, FCPT had approximately $259 million of available liquidity including $16 million of cash and cash equivalents, $8 million of restricted cash from 1031 sales and $234 million of undrawn revolving credit facility capacity.

Credit Facility and Unsecured Notes

  • At December 31, 2023, FCPT had $1,121 million of outstanding debt, consisting of $430 million of term loans and $675 million of unsecured fixed rate notes and $16 million of outstanding revolver balance. FCPT’s leverage, as measured by the ratio of net debt to adjusted EBITDAre, is 5.5x at quarter-end.

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 Mill Valley, CA, is a real estate investment trust primarily engaged in the ownership, acquisition and leasing of restaurant and retail properties. The Company seeks to grow its portfolio by acquiring additional real estate to lease, on a net basis, for use in the restaurant and retail industries. Additional information about FCPT can be found on the website at fcpt.com.

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 U.S. GAAP financial measures, this press release and the referenced supplemental financial and operating report contain and may refer to certain non-GAAP financial measures. These non-GAAP financial measures are in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP financial measures should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures and statements of why management believes these measures are useful to investors are included in the supplemental financial and operating report, which can be found in the investor relations section of our website.

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 ($446,000 and $430,000 of principal, respectively)

$

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, $0.0001 par value per share, 25,000,000 shares authorized, zero shares issued and outstanding

 

-

 

 

-

 

Common stock, $0.0001 par value per share, 500,000,000 shares authorized, 91,617,477 and 85,637,293 shares issued and outstanding, respectively

 

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.

 

Contacts

FCPT

Bill Lenehan, 415-965-8031

CEO

Gerry Morgan, 415-965-8032

CFO

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