Postal Realty Trust (PSTL) 6 Aug 242024 Q2 Earnings call transcript

Greetings, and welcome to Postal Realty Trust Second Quarter 2024 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Jordan Cooperstein, Vice President of FP&A Capital Markets. Please go ahead.

afternoon, good and you, everyone. Thank Realty Welcome Conference Quarter Earnings Second to Postal Call. XXXX Trust's

call Andrew and On Jeremy we today, the have Robert Accounting Chief Chief Garber, Spodek, Klein, Financial Brandwein, Officer; Matt Officer. President; Officer; Executive

Litigation for note company's be the statements, are information, and this call, Exchange specifically and Act company update on including, differ latest safe covered factors Reform not its assume facts affected other by company's which Commission forward-looking risks forward-looking. any to Private considered otherwise. does provisions forward-looking are to, control, not conference a future of of and that the but statements company events are described Actual use the a forward-looking as statements by and These XXXX. that not Please in filings. results are the from the historical materially statements Securities those in The XX-K disclaims statements Securities may contained variety new and are and obligation forward-looking forward-looking the result beyond of limited whether harbor will or any statements in contained may those

conference financial adjusted some call, may Additionally, on debt. as and certain operations, non-GAAP company this net to measures adjusted refer EBITDA funds the operations, funds such from

materials. comparable most can in You financial non-GAAP the and find a tabular GAAP measures currently supplemental earnings these to the reconciliation measures of company's release

of the now Realty I that, to Spodek, Executive turn will over Postal With Andrew Chief Trust. call Officer

rate acquisitions properties the quarter million at a evolving funding added of over majority to joining of Good $X and cap raising afternoon, million our properties the million XX end, equity. of thank for us. second In average X subsequent $XX our credibility for and X.X% we on for you $X and weighted quarter,

cap properties weighted of or activity ROFO Thanks teams as to forward acquire a million to X.X% rate been rate us our cost become the we postal way at $XX $XX.X cuts transaction volume. above position to successful has And regular execution a for accretively. million look average XXXX. tenacious with attractive year-to-date improves, and combined transaction acquire in to Our increasing efforts, interest continuing we capital likely our have of source and more

front, On the in Service partnership made leasing we renewal are the we lease to have process. by the progress the encouraged with annual working improve Postal

Productions kicked have to report leases excited are we that receive started leases to XXXX earnest. We escalations. fully have off for XXXX also that include X% executed in the annual

negotiations to fluid process, further As we details providing have forward once fully look and leases. we the this is remaining a we shared, executed conclude and receive

multinational renewal a company I'm traded space. increase we We completed the achieved also care rent X-year publicly lease our The incorporated XX% pleased non-postal located tenant and at substantial facility. mark-to-market in that share is that escalation. a of tenant a our significant has made Warrendale, with a in annual industrial Pennsylvania base to only technology X.X% investments portfolio health their

are workforce investing our and Postal our committed local Realty, community. we At to in

Harvest, a through this continuing new existing runway the Island hunger a and leasing tradition year flows properties ahead, hunger to both with looks postal row, leading Realty mission improvement The at on Island. and giving of effective waste back a end cash Postal has forward of community. through to growth and of the of properties third tremendous Postal food Realty acquisition external management. supported growth by organization a internal the relief For to Long volunteer company in with reduce

XXXX We for a are well positioned beyond, we'll our keep and and you with progress. successful updated

the now call turn Jeremy. I'll over to

Andrew. you, Thank

attractive Realty as last quarter we acquired flex successful another and was postal quarter second mile Postal well-utilized The for properties.

properties mile XX,XXX XXX,XXX the added square portfolio, feet of feet and to inclusive interior during square square our XX flex XX net leasable acquisitions quarter feet XXX,XXX properties. last Our from from

to quarter totaling definitive an properties million $X.X for additional Subsequent contracts. and under placed properties the has XX X $X.X million acquired company end,

As business remains stated and calls, on generates cycles. stable throughout reliable consistent each economic our prior as the model cash quarter flow company's business

ahead long We prospects largest our us and space. a in growth runway of have of are by opportunity owner the encouraged this as

these in that average maintained serve. logistics Postal network. rate vital have both reflects XX% communities to lease are they and diligence this strategic We a over past importance The This which our historical the due XX-plus Service identifying weighted the retention locations the years, process to crucial of validates properties

represents mentioned, we Andrew the rents. XX% to As started expired have executed which of leases XXXX fully receive

receiving escalations, with to and new for annual addition rent the the lease the prior agreed X% and has rents rent. paid release leases between a catch-up payment the In upon rent executed company the difference

As the $XXX,XXX company net We from update. providing The Service during for received Postal a leases a result, of the payment to further look a QX. forward executed

I'll now XXXX discuss turn the results. Rob financial quarter over call to our to second

thank call. and for us joining Jeremy, on everyone, you, Thank you, today's

rate end revolving delivered well funds operations, fixed outstanding FFO interest $X.XX no to X.Xx, AFFO adjusted borrowings. all and a operations, of average debt our funds $XXX years diluted significant the comprised credit we maturities. was X per quarter, second and from annualized quarter, the share. rate of of facility below X.XX%, outstanding Xx. the within debt For still maturity and The weighted or of million million a $X.XX At adjusted or near-term from target of weighted had debt of unsecured average EBITDA debt XX% had company's Net our senior $XX of

quarter stock our of $XX.XX. proceeds in ATM During second and units for issued gross average program quarter of to price the common XX,XXX partnership at total an of common million $X.X gross our operating end, we approximately shares offering subsequent and approximately through XXX,XXX

projects. $XXX,XXX, was timing CapEx to Recurring due range below our slightly anticipated of some

be Looking we between forward the to $XXX,XXX $XXX,XXX. to and figure QX, anticipate

for Our cash $X.X year the between guidance million remains and million. XXXX full $X.X G&A expense

an annual of basis. Just on continue prioritize to revenue as as in prior years, G&A a cash we decreasing percentage

increase dividend. a XXXX QX from approved $X.XX dividend Board of quarterly of Our Directors share, the a per representing X.X%

collect our to addition during to of contractual Thanks hard the our rents our flows and leader market the significant This foundation strong quarter. our XXX% in operations predictability in record continue cash the of of be and postal we company work, scaling the second proven differentiator to continue real space. business. track remains a to We solid for estate

That concludes our like to open the prepared line questions have. to take may remarks, and you we'd any Operator?

Markets. [Operator BMO Eric Instructions] Our first with comes Borden question from Capital

expirations you're making to be us with X% the progress sounds how tied XXXX addressed. majority much ABR It like bumps going you a just will lease Can good annual now of of your really on remind forward?

This Yes. is Jeremy.

have really final have how we results. fluid Until things to a in we happy actual with been We're progressing. is this know, you As leases hand, talk process. can't

have received been we're So what talking the today XXXX [indiscernible] leases that escalations. is to have and

Okay. [indiscernible]

is XXXX for XXXX with leases received rent tied [indiscernible] and escalations. to

Okay. Appreciate that. And here. one then for Rob

before out how with how -- Or you about take capital letting Just pay drift you are equity a leverage you the at the solution it cash of potentially for are allocation high here? and it other year? or down with with just thinking then X.Xx, leverage remainder or any mix

Yes. Good question.

a on and million raising with versus were, and to over raise manner were advantageous debt well. we're that making doing, foremost, in it as been that this little and we be as equity, was successful the we're borrowing heavier we historically accretive Last more particular than an we're capital first the $X in equity the that in subsequent year to quarter, in some prior markets did million, quarters, although raising QX a to sure acquisitions through given little look, capital we've where $X.X So quarter.

them and below seeing So look, units good through equity we're this runway target sense market, and a is makes it watching if makes below every staying what through the of most monitoring a target, we're Xx. below to of capital monitoring going debt that got the or news we and constant of and be do the our raise operating But the partnership markets sense. is the intend day We've equity. as well but to lot accessing we're

comes from Paolone Our Anthony with next JPMorgan. question

Tony Nahom You right have on now. for

a X for me. Just quick

between is in there any difference the XXXX the the got vintage those include X% renewed XXXX leases annual the that at X.X% clip? For that reescalated,

you're the talking When to about lease? the a you difference, refer content of

executed trying ones previously out at were just escalators guess X.X%. X% and to were figure the I why these Yes. at

is this Andrew. Tony,

into that time, given have think any I on. you going take what's at account to So

to, we're our is we're that escalation of inflationary the So is outcome, the think when we part And XXXX, looking give escalations to. the we there has achieve to lease hopefully, it, changed. be we're that to where to the pleased wholesome I we order even XXXXs, a trying able achieve. part not And in receive the of components. we're lease get environment But mark-to-market I we're good rest results, executed X and with recognize which to we're hoping you rolls able think other as were the the what roll, short of the very it's the important picture. that with happy the a on today, of in are One combination X.X% very to and lease forward is any and we're are one, versus we in update But since will X especially before what when achieving number the really more X% very vintage. that, is

expire regards line earlier, but for Maybe 'XX? in in to XXXX to little without it expect exact I do XXXX vintages? it. that bit Andrew Got the we guess, dates, spoke And you as this along leases be a with will can think and timing giving the what

are documents, shortly is this The hoping people I'm on completed relatively assigned and a these shortly the This No, that our Postal accelerate but movement happy the to hopes mostly not of try they of Look, group quickly. new we're done the they've within gets that that to 'XX our control. thereafter. 'XX get is Service.

next comes with the Domanski And Steven question Janney. from

to insight spend on Can CapEx this projected be potentially your the the TI can please of that more would figure through provide you Also, passed consists year? USPS? for

Steven, good to from hear you.

be project it's look, our the on quarter, your not this X lease question $XXX,XXX. guidance works, So regarding relationship our that with $XXX,XXX about recurring of things And the beautiful with and USPS like. TI of the dependent there how gave associated will TI, is leases. all for CapEx is the But to we next and so about for which the timing

incur renewals. through or So there is to nothing to us for upon pass

turn conference Andrew and to like would I for the session. question-and-answer back our remarks. Spodek to over any concludes closing This

behalf great you. support of for us connecting join with like time we'd evening. upcoming thank Have team, look months. to forward the We and a to today. the the taking Thank to you your in On entire you

has conference presentation. today's now for concluded. The Thank attending you

You may disconnect. now