Four Corners Property Trust, Inc. Announces Third Quarter 2016 Earnings

MILL VALLEY, Calif.--()--Four Corners Property Trust, Inc. (“FCPT” or the “Company”, NYSE: FCPT) announced today its operating results for the quarter ended September 30, 2016.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations”

A supplemental financial and operating report that contains non-GAAP measures and other defined terms, along with this press release, has been posted to the investor relations section of the Company’s website at http://investors.fourcornerspropertytrust.com/.

Highlights for the Quarter Ended September 30, 2016:

  • Net income of $15.2 million, or $0.25 per diluted common share.
  • GAAP rental income of $26.4 million, consisting of $23.8 million in cash rents and $2.6 million of straight-line rent adjustments.
  • NAREIT-defined Funds from Operations (FFO) of $20.3 million, or $0.34 per diluted common share.
  • Adjusted Funds from Operations (AFFO) of $18.2 million, or $0.30 per diluted common share.
  • Acquired 16 restaurant properties with an investment value of $23.0 million, an initial cash yield of 6.8%, and a weighted average lease term of 16.1 years.
  • General and administrative (G&A) expenses for the quarter of $2.6 million including $0.4 million of non-cash, stock-based compensation. Management reconfirms its guidance for an annual G&A run rate of approximately $10 million, excluding non-cash stock-based compensation and acquisition transaction costs.
  • Regular dividend of $0.2425 per common share for the third quarter of 2016.
  • $350 million of available liquidity at quarter-end on the Company’s revolving credit facility.

CEO Comments:

Bill Lenehan stated, “During the third quarter we closed on our initial acquisitions and continued to build a significant acquisition pipeline. We are partnering with established, creditworthy tenants operating leading national quick service and casual dining brands that will provide diversification and growth on top of our high-quality existing portfolio. As we near our one-year anniversary as a standalone company, we are pleased with the progress we have made in building our team and executing on our strategy.”

Real Estate Portfolio:

As of September 30, 2016, the Company’s rental portfolio consisted of 434 restaurant properties located in 44 states. The properties are 100% occupied under long-term, triple-net leases with a weighted average remaining lease term of approximately 13.8 years and an estimated portfolio weighted average EBITDAR to Lease Rent coverage of 4.2x.

Conference Call Information:

Company management will host a conference call and audio webcast on Thursday, November 3, 2016 at 2:00 pm Eastern Time to discuss the results. Presentation materials will be posted prior to the call on the Company’s website, www.fourcornerspropertytrust.com.

Interested parties can listen to the call via the following:

Internet: Go to http://dpregister.com/10094134 at least 15 minutes prior to start time of the call in order to register and to download any necessary audio software. Please note for those that register, the dial-in number will be provided upon registration.

Phone: 1-888-346-5243 (domestic) / 1-412-317-5120 (international). Participants not pre-registered must ask to be joined into the Four Corners Property Trust call.

Replay: Available through Feb 3, 2017 by dialing 1-877-344-7529 (domestic) / 1-412-317-0088 (international), Access Code 10094134

About FCPT:

FCPT, headquartered in Mill Valley, CA, is a real estate investment trust primarily engaged in the acquisition and leasing of restaurant properties. The Company will seek to grow its portfolio by acquiring additional real estate to lease, on a triple-net basis, for use in the restaurant and related food services industry.

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; and expectations regarding the making of distributions and the payment of dividends. 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. Factors that could have a material adverse effect on the Company’s operations and future prospects or that could cause actual results to differ materially from the Company’s expectations are included in the sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 22, 2016.

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 Third Quarter 2016 operating results and other information on the company are available on the investors relations section of FCPT website at www.fourcornerspropertytrust.com

               
Four Corners Property Trust
Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share data)
 
 
Three Months Ended September 30, Nine Months Ended September 30,
2016 2015 2016 2015
 
Revenues:
Rental income $ 26,373 $ - $ 78,836 $ -
Restaurant revenues   4,443     4,413     14,003   13,927
Total revenues 30,816 4,413 92,839 13,927
 
Operating expenses:
General and administrative 2,608 - 8,434 -
Depreciation and amortization 5,059 208 15,347 605
Restaurant expenses 4,308 4,088 13,600 12,936
Interest expense   3,549     -     11,588   -
Total operating expenses   15,524     4,296     48,969   13,541
 
Income before provision for income taxes 15,292 117 43,870 386
(Provision for) benefit from income taxes   (52 )   (6 )   80,455   5
 
Net Income $ 15,240   $ 111   $ 124,325 $ 391
 
Basic net income per share $ 0.25 N/A (1) $ 2.22 N/A (1)
Diluted net income per share $ 0.25 N/A (1) $ 2.09 N/A (1)
Regular dividends declared per share $ 0.2425 N/A (1) $ 0.7275 N/A (1)
 
Weighted-average shares outstanding:
Basic 59,832,824 N/A (1) 56,026,594 N/A (1)
Diluted 59,863,109 N/A (1) 59,469,008 N/A (1)
(1)       Due to the material change in the Company’s operations as a result of our formation transaction in November 2015, management does not consider presentation of income per share for the pre-formation period to be meaningful.
 
       
Four Corners Property Trust
Consolidated Balance Sheets

(In thousands)

 
 
September 30, 2016
(Unaudited) December 31, 2015
ASSETS
Real estate investments:
Land $ 405,245 $ 404,812
Buildings, equipment and improvements   1,002,393     992,418  
Total real estate investments 1,407,638 1,397,230
Less: Accumulated depreciation   (582,870 )   (568,539 )
Total real estate investments, net 824,768 828,691
Real estate held for sale 12,318 -
Cash and cash equivalents 18,870 98,073
Deferred rent 9,299 1,500
Derivative assets - 165
Other assets   1,130     1,008  
Total Assets $ 866,385   $ 929,437  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
Liabilities:
Notes payable ($400,000, net of $6,504 and $7,698 of deferred financing costs, respectively) $ 393,496 $ 392,302
Dividends payable 14,510 -
Deferred rental revenue 7,885 7,940
Derivative liabilities 6,594 477
Deferred tax liabilities 196 80,881
Other liabilities   4,340     6,195  
Total liabilities   427,021     487,795  
 
Stockholders' 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, 59,888,447 and 42,741,995 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively

 

6 4
Additional paid-in capital 437,838 436,697
Retained earnings 7,978 5,257
Accumulated other comprehensive loss   (6,458 )   (316 )
Total stockholders' equity   439,364     441,642  
Total Liabilities and Stockholders' Equity $ 866,385   $ 929,437  
 
 
Four Corners Property Trust
FFO and AFFO
(Unaudited)
(In thousands, except share and per share data)
       
 
 

Three Months Ended
September 30, 2016

 

Nine Months Ended
September 30, 2016

Funds from operations (FFO):
Net income attributable to stockholders in accordance with GAAP $ 15,240 $ 124,325
Depreciation and amortization 5,059 15,347
Deferred tax benefit from REIT election   -     (80,410 )
FFO (as defined by NAREIT) $ 20,299   $ 59,262  
Non-cash stock-based compensation 412 1,158
Non-cash amortization of deferred financing costs 398 1,194
Other non-cash interest (income) expense (296 ) 139
Straight-line rent   (2,609 )   (7,799 )
Adjusted funds from operations (AFFO) $ 18,204   $ 53,954  
 
Fully diluted shares outstanding 59,863,109 59,469,008
 
FFO per diluted share $ 0.34 $ 1.00
 
AFFO per diluted share $ 0.30 $ 0.91

Contacts

Four Corners Property Trust, Inc.
Bill Lenehan, 415-965-8031
CEO
Gerry Morgan, 415-965-8032
CFO

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