Wheeler Real Estate Investment Trust (WHLR) 7 Mar 182017 Q4 Earnings call transcript

Greetings, ladies and gentlemen, and welcome to the Wheeler 2017 Fourth Quarter and Year-End Earnings Conference Call. [Operator Instructions] Please note that today's conference call is being recorded with the webcast replay available for the next 90 days. The dial-in details for the replay can be found in yesterday's press release and can be obtained from the Investor Relations section of Wheeler's website at www.whlr.us. [Operator Instructions] I will now turn the conference call over to Mary Jensen, of IRRealized. Please go ahead.

Operator. you, Thank

the Chief on and are Kelly, Dave Franklin, Joining Officer; call Matt and Executive Operating Officer; Reddy, President Chief us Officer. today Chief Andy Financial

of based on beliefs making course During currently will and made the call, available forward-looking are These to of be us. the statements forward-looking this by statements. information assumption we

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

reasonable, they be Although not that actual we and assumptions are maybe some to to believe future those of prove future expected material. and expectations incorrect. are performance from be our guarantees our our differ differences results will could Therefore

filings which be the by more undertakes of website. X, Relations no duty as in detail our not required can section update of Real Investor statement March today and a current information XXXX. call risks, is description Wheeler unless this law. SEC does forward-looking presented please of on All potential found For our some refer to to intend

section obtained of the addition, reports on as such which call company's can measures also in and financial AFFO can be In this FFO be Relations quarterly website. presented Investor found non-GAAP of reconciliations our the on

Dave. Matt that the today, results remarks to like to Andy were Matt recent will business released I Reddy questions. would provide After Dave activities and prepared With our financial take an your yesterday. During prepared call and and be quarterly will will Kelly update turn Dave, remarks, annual that on available discuss to the over our

as XXXX lot year-end will and us weighing a on for changes today. operating and today be outlining results the Mary, aligned the we is To team and is I how with there priorities in Andy our do Yesterday think plan minds. a here discuss fourth are stakeholders' it pleased to remarks. of that discuss month the I we shareholders I this. to well his later everyone here over and A past start, month. you, are Matt Today Matt, Thank want to ensure our what ago our financial everyone's new reported been letter interest. which you C-suite to have leadership interest and quarter to in we joining a thank issued organization's

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our core we question. know portfolio there we few solid portfolio, believe pertaining items has have that we are Although a in to been that

to our of and SEC, speculation our as definitive tenants ongoing there for tenant. particularly a mitigating normal business on risk. articles news First, we surrounding plan these Southeastern are parent news our largest At is that you us BI-LO. our be comment cannot we this share roamers, any however, it questions potential time surrounding Grocers on the as discussions or largest there course significant in with will familiar understand the speculation both of with routine from We are is tenant of soon company any various

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$XX.X diligently Second, our believe irreplaceable but the located working in is place will diversifies Virginia time performance. cap its and the and our rents a Adding that based expected and real property acquisition shopping Shopping tenant on million on of estate our deliver opportunities into on center of JANAF revenue of January X.X acquired with our North Yard iconic to performing as team we it future we JANAF JANAF exposure value portfolio in future is long-term XX generation. creates for at annualized at operation portfolio. immediate acquisition. is which incorporating many property The an our

Following into this the future. acquisition, new not we’ll be for acquisition foreseeable any transactions entering

portfolio current capacities. strategy our balance this of department corporate our maximizing sheet. be repurposing Part of be our the associates will within work certain will deleveraging other focus in and acquisitions Our to

leasing any company Turtle on a position and process The some associated agreement has will with our pursue development to due legacy $X.X assets. assets be almost services quarter year. reserve just This Matt forward. total on options a full G&A On under providing fourth review being note, this as expand all us ownership lower these or that to any on Sea third-party one-time Turtle not It's for of we quarter a a his remarks. have taken management assets receivable, receivables positive receivables. one-time legacy million and the going available been The been corporate more leasing or year. expenses the we impairment to and notes was hit XX% from these the to project asset is intention in terminated. management and for Third, recover Sea $X.X for agreement XX% have operating lower terminated marketplace have and on of in has will in the no legacy as million well other and

Going associates be the trend acquisition corporate downward. which G&A last slightly is operating remain during non-property we now the to expect forward, flat of increase should to due from overhead. expenses continue reassignment will This up expenses to year. Overall, to absorbed

As have approximately discussed have office conference, in savings the actively come regional the we have potential and $XXX,XXX significant an our from expenses. and marketing advertising the a of before expenses identified South $XXX,XXX basis reductions annualized of our Charleston, on Roughly, of we non-property been reducing and across Carolina company. savings will closing

significantly costs we these expense onetime However, by savings. associated with expect strategic some be will analysis outweighed which KeyBanc

debt plan to our to like discuss balance burden. our I’d and Now sheet the reduce

debt. of common of for approximately to dividend of cash remainder the XXXX has the which makes First, Directors operate the suspended pay and available to the business Board $X million down

actively we marketing a Beach X.X acre parcel price in sales a several significantly land sale. announced, Virginia previously non-core $X.X assets select for parcels the stabilized We're negotiating cost. As acquisition are at for above offer million a

developing strategy sales. to is company addition, prudent In assisting utilize The expects KeyBanc proceeds asset portfolio the from to us a in debt. reduce the disposition sales analyzing for and further these

the in making we this progress believe the that, with are year, agreement company XXXX. maturity to a the of revolving the ability appreciate facility new the I'll its KeyBanc optimistic date $XX balance million. which the This and highlights. Matt increases the April, turn remain which $XX.X terms in support in things these limit to you outstanding repay maturity date will timetable amended financial borrowing X, meet the for our in significant with in The million July retiring our right XXXX. $XXX million million are from patience. your $X.X two the addition, on/or third December. by and this credit from the from fourth $XX.X direction confident increase With turn, and debt of must company date. and years that current the by of Matt? extend in restated to debt who We to million We walk extend equally we matures terms option million the of before about accordion We're of Revere borrower quarter In through the steps $XXX over refinancing

our Thanks $X.XX we to common $X.XX. the $X.XX reported falling share of quarter, per Dave. quarter range short for fourth Yesterday AFFO of of fourth guidance

$X.XX due other excluded on reserved the a of which receivables our portion guidance historically The receivable. interest million to of to presented For $X.XX. driver directly previously range $X.XX due management related and include The asset annual was relates million services, shortfall per to is due in amounts than for a at the interest as reserve development leasing the fees, AFFO has party share amounts for compared AFFO $X.XX $X.XX charges primary from which note of year, impacted maturity reserve AFFO. million commissions, $XX this been

which diluted of guidance year full and and Excluding impact, $X.XX is this line fourth diluted per the been diluted quarter our with $X.XX AFFO respectively, per per more $X.XX end low share the for share. $X.XX in and have onetime would of share

an In receivable development note These based the complete These project the cap change Hilton the $X.X the addition Carolina. decrease or party increase from due the the executed could calculated Turtle from onetime and costs, other of at project, factors the impairment. $XX on million realized fair the by these impairment result resulting taken company today in to South projected known to that fund stabilization related and million receivables, we including value future rates. on against can to in quarter reserve leases, charges cost of a and financing NOI, in available Sea anticipated the marketplace sources assumed during Head, are factors

basis. lower reduce was by property loss been operating Career primarily offset associated generated our which leasing associated as tenant by year-over-year attributed a offset Square partially same This and results, Point same as revenue, reimbursements be X.XX% is store losses discussed of in on at growth to can we with reduction Perimeter in revenue prior with quarters. increase store has well X.XX% driven This spreads. expenses which to same-store Turning a by positive NOI same-store X.XX% expenses,

Moving onto results. our operating

leased XX. occupied portfolio core is at performing XX% at Our expected December XX% as and

XXX the foot per and square rates. prior at totaling XXXX, X.X% of During lease an executed increase XXX,XXX renewals weighted-average feet over we of $X.XX increase a square

During XXX,XXX we the square feet with square same totaling $XX.XX average new per period, foot. leases XX weighted signed rate of a

representing leases at of increase. feet quarter weighted-average square $X.XX XX,XXX fourth renewed we the XX for rates X.XX% a During over prior a increase

square space in discuss prior the ABR Overall year. compared at of an of XX, the to to like square $X.XX leases ABR square square by would per that portfolio an I $X.XX. of for as an foot tenants new had foot foot. $X.XX at XX,XXX were per a who per average December guidance of $X.XX our new total policy. leasing leases did were to rent signed XX addition XX,XXX These these previously for not average foot new of feet renew square per footage renewals, square XX In offset were now

through While we transition be not this guidance. issuing company will the strategic and current worked the KeyBanc planning process, earnings

to keep company. a However, appropriate. in like end, should as will your major effort of to of which items activities remain the apprised you business I we an analysis with discuss To help would transparent, that few

earlier leasing Further, development stated third-party are our third in we or has were Development revenue with legacy XXXX. assuming leasing XX, or from outstanding been party Sea been are terminated. as being and terminated. in resulting at management, with have not First, meaningful the Therefore, management asset any that assets associated the services agreements agreement XXXX Turtle the December of process

on the going $XX from putting not Additionally, result non-accrual interest million will a net a Sea the Turtle we forward recognize receivable of income net as basis.

for asset commissions, receivable. approximately expense represents portion occur $X.X is AFFO note effort providing time this value be And during chain of and amounts comprised party XXXX core $X.XX in in about leasing generated the the transitioned management, and the of assets AFFO reserves of interest the related acquisition. million these these XXXX assets development third, XXXX. to spent not perspective and services on of now management of our portfolio legacy to would resources the our the year. to that X% in services This leasing an to recent maximizing Second, put Net in expected and property

to acquired recently sources. lost should prior property our generate partially these from offset Virginia revenue However, revenues

KeyBanc working Dave we ensure including we're obligations Finally, mentioned Revere. as refinance obligations and near-term to pay daily down are first meeting to and/or our our debt

will working that, deleveraging. are to KeyBanc strategies prudent take we to questions. to we the happy balance through identify Additionally, with With your sheet be strengthen

today comes first Riley. of Kucera go Please Our ahead. question Instructions] B. from [Operator Craig

aren't dividend forcing it more a various or but I was Southeastern noise you to even so sort think Board the as market from the expecting peers around the of that considered? a how maybe change significant cuts, some consider versus know it to the you cut the was lot given cutting comparable something funds, Grocers' spending of

quite did dividend the the was the our because cut that we felt considered, the helping and just was Certainly just was sheet. choice the cash we decision us a the saw but savings year-over-year. deliberation choice the made the - of was on dismount we proceeds from bit served will balance better of delever position We going get Board

So as it as was that. real simple

Turtle But past feel questions you in those I but for going thought I to year? It to increase modestly looking we you G&A. be folks you're to able of in some to corporate cover your and Sea out sounds about flattish them should the commentary. had reallocating said other G&A like, like you you'd strip be G&A for be some a this did

able typically towards on conventions been G&A probably office, to Since will cut going and to the we forward, expenses are be to you should we But should ICSC going we're roll G&A script, budget. operating that trending the on of as not in be overall our then outlined those have relatively Charleston acquisitions. savings the the will closure the still those our we're to bottom flat. the discretionary within the into back in of advertising, number that while downward pointed stay Well associates so line savings past overall be based different be significant we doing expenses those these kind fall our the roles associates they acquisitions going into and capitalize company out, acquisitions Matt - going

I know you you're us Southeastern you Can the hoped a this can't like past at large years we would be. underwrote a flow you might sense you and you Grocers, where feel in you said encapsulate cash those looking to stand be what least at had formally said on point extent impact today comment to at broad I might of give as that you think to ago? somewhat what properties the several the impact

At wouldn't what Grocers speculate to point do any for anything, just they're announcement. Southeastern because us this not have it filed appropriate be going to with on

of But anticipate then what may any process I to So what going speculate they on be forward. to I our are soon kind announcement, going they can't is make discuss or as as can't we do. prepared

of with, course Of course we have kind been of normal discussions in as business.

our with all especially discussions We’re BI-LO tenant, in our being largest.

with time isn't what announcement, several this be. their until it for So them they conversations we really just is have appropriate make to had but might not it appropriate us speculate that announcement

strategic give And what considering can us is alternatives firm at you in picture a point the brush this broad of time?

Well, was robust wanted all review a to for options. of us bringing take total the alternate the we point KeyBanc strategic

really on being KeyBanc reviewed is what kicking are point all inappropriate full now. being that review is for right It this and right just timeframe now them options are options So to at all the comprehensive such on comment on us kind a There's because no into it table. frankly is this, are of of but reviewed.

is pretty the early. So process

go from question of Compass Point. Manaker Steve Please ahead. is next Our

can Quick on do sell also do any that? just you of alone, kind a teed think review to fast maybe Thanks. is from these strategy, next up, question more liquidity - to will how the the question be standpoint, from the going how repay the able of you you assets be, have assets? you And just about disposition wondering some

holdings to in we now number significantly we do that April that. currently and into one discussions loan can have we'll a that that I confident are deeply part this regard at of Revere kind pay some been review to and With - strategy in on into will now allow can't that On and negotiating now. on currently us answer back also our parcel strategy, disposition put right disclose right the properties. balanced and is X.X right just is we they to acre looking to land into we an involvement, going on prior Virginia of have that review refinance a line the it starting to again going on the line, down are encompass we're review But producing maturity assets market Beach non-core But stepping that position. may be paid to of NOI disposition the their here we're discussions to KeyBanc's have my properties, exactly be off we've who that’s offer on XX. along

of then So we'll be the determine kind income producing those look income non And KeyBanc with going that going on. and assets. what moving decision on strategy to be to like will is producing immediately forward working properties

some just Revere they of going Quick you will first mortgages? those second follow - re-file on be loan, be are mortgages when you or the to up loans,

Those will be first mortgages.

is Williams Newbridge ahead. Your James Securities. next from Please of question go

cutting ask as simple that I investors of that, that it. got because that's dividend of minute don’t for only as and income look as retired a lot was them some simple as the just people a see just on I stated that you, a people ago you question me being for they that a let are the or street most your - buy and reason

to street REITs at on on the dividend. income since at you’re still the numbers here could want the because because buy and and if the a side. there put neighborhood will investment cutting get the your the retail you new world look so in something the out $X.XX you least be you Why again, management say people out buy of people I somewhere take leave the cut if dividend be on So in they around out wouldn’t investors you what AFFO dividend property the still

would and are that sudden out of not comes dividend on not paint could we’ve income out last this of four three buy that no leaving things the it stores. okay, people it? picture I to on What's it, value play again. when thought all of your again going the they something to a your says, process or Southeastern taken world for is might Grocers you a want least but crushed there if So guess get in that Once buy at why

thing basically balance this the estate value then from and the only dividend by by is to the opportunity not the and Well was company we us long-term and we company need do of real but - operate, deleveraging further better the our gives us to liquidity enhanced also sheet, continue we a think correcting tell the generate the using as delever to the sales. companies funds which from would running to operated cut opportunity asset had give

So, we’re term longer proceeds. looking long-term the the then we at the dividend that for of - the strategy think the term immediate is longer is of holders better picture stock

reports we now, So XXX% basically saying? wrong, in this that coming so - mode these we’re right other obligations the are guess that I up and I correct were year now we last we’re crisis basically when to if were in to mode what right such we on be didn't buying crisis basically are which I’m believe your cut in have meet just the such is you dire a to dividend able over

have the We dividend. suspended

able delever assets of review to us company ongoing also XXXX decision this company will dividend real We allow opportunities and dividend the that allow at remainder to And the again crisis we company year. to be the beginning to as operate. year will us sales prudent of at to the we then review not end which provide are then the think of but estate from in the long-term a the a operate savings the For to use will is again it mode. the us used

million here, point the quick increased line much million. real was borrowing How from says right that have $XX.X off other at question $XX to - that's capacity borrowed your you So now? one it

we have we're of year $XX X process now by a stated that Right by we in this that. the and million as of $XX.X doing of bringing balance balance million and – we're down July

July and million $XX balance by So, bring we X. million got to that down we'll $XX.X

closing all That's to Mr. I’ll the questions time remarks. we over the turn Kelly today. have for back for call

of you over reached want past out thank very XX to much, one the days. and have investors I we thank that Okay, every the

and We deal have as us be a transparency much restoring and an us this correction steady process great value disciplined overnight of focus won’t on as work ahead with possible. but of a and shareholder with sole

for week. a us great you thank hope So have joining and today you

concludes call. That today's

now may You disconnect.