Four Corners Property Trust, Inc. (NYSE:FCPT) Q4 2019 Earnings Conference Call - Final Transcript

Feb 13, 2020 • 11:00 am ET

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Four Corners Property Trust, Inc. (NYSE:FCPT) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, and welcome to the FCPT Announces Earnings for Fourth Quarter 2019 Conference Call. [Operator Instructions] Please note that this event is being recorded.

I would now like to turn the conference over to Gerry Morgan. Please go ahead, sir.

Executive
Gerald Morgan

Thank you Chuck. Joining me on the call today is Bill Lenehan. During the course of this call, we will make forward-looking statements, which are based on beliefs and assumptions made by us and information currently available to us. Our actual results will be affected by known and unknown factors that are beyond our control or ability to predict. Our assumptions are not a guarantee of future performance, and some will prove to be incorrect. For a more detailed description of our potential risk, please refer to our SEC filings, which can be found in the Investor Relations section of our website at fcpt.com.

All the information presented on the call, is current as of today, February 13, 2020. In addition, reconciliation to non-GAAP financial measures presented on this call, such as FFO and AFFO can be found in the Company's supplemental report available also on our website.

And with that, I'll turn the call over to Bill.

Executive
William Lenehan

Thank you Gerry. Good morning everyone, and thank you for joining us to discuss our fourth quarter results and outlook as 2020 gets underway. Our portfolio performed as expected in the fourth quarter. We achieved an increase in AFFO to $0.36 per share, and EBITDAR coverage remained strong at 4.7 times. I'd like to draw your attention to the unusually high volume of properties acquired near the end of the fourth quarter. We will see the full effect of these properties, impacting our results in the first quarter of 2020.

In the fourth quarter, we acquired 50 properties in 21 separate closings, for a combined purchase price of $120.6 million with over $88 million of these closings in the last week of the quarter alone. For the year, we acquired 90 properties for a combined purchase price of $199 million. The fourth quarter acquisitions are a great example of the type of quality assets and granular tenant diversity we continue to add to the portfolio. To support that statement, I offer two statistics from the fourth quarter acquisitions. First, with respect to quality, over 80% of leases on these properties are with or guaranteed by the corporate restaurant brand. Second, with respect to diversification, the 50 acquired properties represent 34 different brands, 17 of which were new to our portfolio.

Over half of the properties acquired in the quarter, were the result of our outparcel strategy with closings from WPG, Brookfield, Seritage and PREIT. These transactions have taken time and perseverance, but have been worth it, given the quality of the assets. We've now announced over $278 million in outparcel transactions. These properties are characterized by strong national brands, lower rents as many are ground leases, and are substantially leased to the brand's corporate or franchise or entity. Our recent expansion to