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Section 1: 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

March 8, 2019

Date of Report (Date of earliest event reported)

 

PLYMOUTH INDUSTRIAL REIT, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

 

         
MARYLAND   001-38106   27-5466153
(State or Other Jurisdiction
of Incorporation)
  (Commission
File Number)
  (IRS Employer
Identification No.)

 

260 Franklin Street, 7th Floor

Boston, MA 02110

(Address of Principal Executive Offices) (Zip Code)

(617) 340-3814

(Registrant’s Telephone Number, Including Area Code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company   

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   

 

 

 

 

Item 2.02Results of Operations and Financial Condition

On March 8, 2019, Plymouth Industrial REIT, Inc. (the “Company”) issued a press release (the “Earnings Release”) announcing, among other things, earnings for the three months and year ended December 31, 2018. The text of the Earnings Release is included as Exhibit 99.1 to this Current Report.

 

The Earnings Release is furnished pursuant to Item 2.02 and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 7.01 Regulation FD Disclosure.

On March 8, 2019, the Company disclosed a supplemental analyst package in connection with its earnings conference call for the three months and year ended December 31, 2018 which took place on March 8, 2019. A copy of the supplemental analyst package is attached hereto as Exhibit 99.2.

 

The supplemental analyst package is furnished pursuant to Item 7.01 and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d)       Exhibits:

 

  Exhibit No.   Description
       
  99.1  

Press Release dated March 8, 2019

       
 

99.2

 

Supplemental Analyst Package – Fourth Quarter 2018

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

        PLYMOUTH INDUSTRIAL REIT, INC.
         
Date: March 8, 2019       By:  

/s/ Jeffrey E. Witherell

            Jeffrey E. Witherell
            Chief Executive Officer

 

(Back To Top)

Section 2: EX-99.1

Exhibit 99.1

 

 

Contact:

Tripp Sullivan

SCR Partners

(615) 760-1104

TSullivan@scr-ir.com

 

PLYMOUTH INDUSTRIAL REIT REPORTS FOURTH QUARTER RESULTS AND ISSUES 2019 GUIDANCE

 

BOSTON, March 8, 2019 – Plymouth Industrial REIT, Inc. (NYSE America: PLYM) (the “Company”) today announced its consolidated financial results for the quarter ended December 31, 2018 and other recent developments. A comparison of the reported amounts per share for the fourth quarter of 2018 to prior-year periods has been affected by an increase in the common stock outstanding resulting from the completion of, and the use of proceeds from, the Company’s initial listed public offering (the “IPO") in June 2017, its preferred stock offering in October 2017, a follow-on common stock offering in July 2018 and a private placement of preferred stock in December 2018, as discussed below.

 

Fourth Quarter and Subsequent Highlights

·         Reported results for the fourth quarter of 2018 reflect a net loss attributable to common stockholders of $5.2 million, or $(1.10) per weighted average common share, including a loss on extinguishment of debt of $1 million and a gain on sale of real estate of $1 million; net operating income (“NOI”) of $8.8 million; Funds from operations attributable to common stockholders and unit holders (“FFO”) of $0.35 per weighted average common share and units; and Adjusted FFO (“AFFO”) of $0.23 per weighted average common share and units.

·         For the fourth quarter of 2018, declared a regular quarterly cash dividend of $0.375 for the common stock and a regular quarterly cash dividend of $0.46875 per share for the 7.50% Series A Cumulative Redeemable Preferred Stock (“the “Preferred Stock”).

·         Issued initial 2019 guidance of a net loss of $(1.87) to $(1.77) per share; Nareit FFO attributable to common stockholders and unit holders of $2.50 to $2.60 per diluted share; and AFFO of $1.90 to $2.00 per diluted share.

 

Jeff Witherell, Chairman and Chief Executive Officer of Plymouth Industrial REIT, noted, “2018 has been a transformational year for us, and the previous investments we made in our people, infrastructure and processes enabled us to accelerate our pace of acquisition and capital markets activity during the second half of the year with minimal incremental overhead. With over 2 million square feet added to the portfolio in the fourth quarter alone, we were able to exceed our expectations for the year on every key metric and position us for a period of earnings and cash flow growth that is more indicative of the value we have created in our portfolio. At the same time, the strategic investment from Madison brings in a valuable and well-respected partner that has enabled us to maintain a disciplined approach to capital allocation and a much clearer path to improving our capital structure.”

 

Financial Results for the Fourth Quarter of 2018

The completion of the IPO in June 2017, a preferred stock offering in October 2017, a follow-on common stock offering in July 2018 and the strategic investment by Madison in December 2018 provided the Company with a meaningfully different capital structure for the fourth quarter of 2018 compared to the fourth quarter of 2017. The Company believes the use of the respective proceeds and related higher share count, makes year-over-year comparisons less meaningful, particularly on a per share basis.

 

Net loss attributable to common stockholders for the quarter ended December 31, 2018 was $5.2 million, or $(1.10) per weighted average common share outstanding, compared with net loss attributable to common stockholders of $5.3 million, or $(1.44) per weighted average common share, for the same period in 2017. The decrease in net loss for the fourth quarter of 2018 was primarily due to a decrease in operating loss of $1.2m primarily driven by the acquisition activity in 2018, gain on sale of real estate realized in the fourth quarter 2018 of $1 million, offset by an increases in interest expense of $0.7 million, loss on debt extinguishment of $1 million and preferred dividends $0.35 million, Weighted average common shares outstanding for the fourth quarters ending 2018 and 2017 were 4.7 million and 3.7 million, respectively.

 

Consolidated total revenues for the quarter ended December 31, 2018 were $13.6 million, compared with $8.4 million for the same period in 2017.

 

 

NOI for the quarter ended December 31, 2018 was $8.8 million compared with NOI of $5.3 million for the same period in 2017.

 

EBITDA for the quarter ended December 31, 2018 was $7.0 million compared with $3.2 million for the same period in 2017.

 

FFO attributable to common stockholders and unit holders for the quarter ended December 31, 2018 was $2.0 million, or $0.35 per weighted average common share and unit, compared with $(0.7) million, or $(0.17) per weighted average common share and unit for the same period in 2017, primarily as a result of increased depreciation and amortization driven by acquisition activity, the loss on extinguishment of debt of $1 million and the increase in weighted average shares following the public offering completed in July 2018, offset by an increase in preferred stock dividends of $0.35 million and the gain on sale of real estate of $1 million.

 

AFFO for the quarter ended December 31, 2018 was $1.3 million, or $0.23 per weighted average common share and unit, compared with $190,000, or $0.05 per weighted average common share, for the same period in 2017, primarily driven by the change in FFO attributable to common stockholders and unit holders, a net decrease in deferred finance fees and non-cash interest of $855,000, increased straight line rent and above/below market rent adjustments of $161,000, increased recurring capital expenditures and lease commissions of approximately $540,000 incurred in the quarter and the increase in weighted average shares following the public offering completed in July 2018.

 

See “Non-GAAP Financial Measures” for complete definitions of NOI, EBITDA, FFO and AFFO and the financial tables accompanying this press release for reconciliations of net income to NOI, EBITDA, FFO and AFFO.

 

Investment Activity

As of December 31, 2018, the Company had real estate investments comprised of 55 industrial properties totaling 12.0 million square feet with occupancy of 95.0%.

 

On October 15, 2018, the Company completed the acquisition of a 1.1 million-square-foot multi-tenant Class B industrial property in the greater Cincinnati, Ohio market for total consideration of $24.8 million. The building is 92% leased and projected to provide an initial yield of 8.5%. The acquisition was funded with the issuance of 626,011 operating partnership units valued at approximately $10.6 million, or $17.00 per unit, the assumption of $13.9 million of existing mortgage debt secured by the property and $0.25 million in cash.

 

On December 14, 2018, the Company completed the transformational acquisition of a 20-building, 1.1 million-square-foot light industrial and flex portfolio in Jacksonville, Florida for $97.1 million. The portfolio is 96% leased and projected to provide an initial yield of 8.4%. The acquisition was funded with approximately $34 million in proceeds from the Madison International Realty investment described below and a $63 million short-term loan that the Company expects to refinance during the first quarter of 2019 with long-term secured financing with a life insurance company.

 

On December 19, 2018, the Company sold 525 West Marquette, a 112,144-square-foot industrial building in Milwaukee, Wisconsin, for $5.3 million, resulting in a one-time gain of $1 million on the sale in the fourth quarter of 2018. Proceeds from the sale were used to pay down $3.4 million of debt on the Company’s $78 million loan with Transamerica Life Insurance Company and for general corporate purposes.

 

On January 4, 2019, the Company completed the acquisition of a 73,875-square-foot, multi-tenant Class B industrial building in the Chicago area for $5.4 million in cash. The acquisition was funded with borrowings on the Company’s credit facility and is projected to provide an initial yield of 8.9%.

 

Leasing Activity

Leases commencing during the fourth quarter of 2018 totaled an aggregate of 115,000 square feet, all of which were for leases of at least six months. These leases included 87,000 square feet of renewal leases and 28,000 square feet of new leases. The Company will experience a 17.6% increase in rental rates on a cash basis from these leases.

 

For the twelve months ended December 31, 2018, leases executed totaled 1,546,000 square feet, of which 1,451,000 square feet was for leases of at least six months. The leases six months or longer included 482,000 square feet of renewal leases and 969,000 square feet of new leases. The Company will experience a 5.8% increase in rental rates, on a cash basis, from all of the leases executed in 2018 with a lease term of at least six months.  The weighted average term for these leases is 4.3 years. Absent a previously disclosed 40,000-square-foot lease in the third quarter with the Federal Aviation Administration, the Company would have reported a 9.6% increase in rental rates on a cash basis from these leases for the full year 2018.

 

 

Capital Markets Activity

On December 14, 2018, the Company issued to Madison International Realty 4,411,764 shares of the Company’s Series B Convertible Redeemable Preferred Stock at a price of $17.00 per share, or $75.0 million aggregate consideration, in a private placement. The shares of Series B Convertible Redeemable Preferred Stock are convertible into shares of the Company’s common stock, at the option of the holders, commencing on January 1, 2022. Prior to the receipt of stockholder approval, such conversion into shares of common stock is limited to the aggregate of the 19.99% limit under applicable NYSE American rules.

 

The annual cash dividend on each share of Series B Convertible Redeemable Preferred Stock is 3.25%, or $0.5525 per share, for the period from the closing of the private placement through December 31, 2019, and is payable when, as and if declared by the Company’s Board of Directors, quarterly in cash on January 15, April 15, July 15 and October 15 of each year, commencing on January 15, 2019. The annual cash rate increases to 3.50% in year two; 3.75% in year three; 4.00% in year four; 6.50% in year five; and 12.00% in year six. As noted below, the liquidation preference of Series B Convertible Redeemable Preferred Stock accretes at a higher annual internal rate or return.

 

The shares of Series B Convertible Redeemable Preferred Stock have a liquidation preference in an amount per share equal to the greater of (i) an amount necessary for the holders to receive a 12% annual internal rate of return on the issue price of $17.00 and (ii) $21.89, subject to adjustment, plus accrued and unpaid dividends. Concurrently with the closing of the private placement, the Company and Madison entered into an agreement requiring the Company to file a registration statement with the Securities and Exchange Commission to register for resale the shares of the Company’s common stock issuable upon the conversion of the Series B Convertible Redeemable Preferred Stock on or before the date that is 60 days prior to the third anniversary of the closing of the private placement.

 

$5.0 Million Stock Repurchase Authorization

On December 14, 2018, the Company’s Board of Directors authorized a stock repurchase plan providing for the purchase in the aggregate of up to $5 million of the Company’s common stock. No stock repurchases were made during the fourth quarter of 2018.

 

Quarterly Distributions to Stockholders

On November 29, 2018, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.46875 per share for the Preferred Stock for the fourth quarter of 2018. The dividend was paid on December 31, 2018 to stockholders of record on December 14, 2018.

 

On December 13, 2018, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.375 per share for Company’s common stock for the fourth quarter of 2018. The dividend was payable on January 31, 2019, to stockholders of record on December 28, 2018.

 

Guidance for 2019

For the year ending December 31, 2019, the Company issued its guidance for net loss of $(1.87) to $(1.77) per weighted average common share and operating unit outstanding, Nareit FFO attributable to common stockholders and unit holders of $2.50 to $2.60 per weighted average common share and unit and AFFO of $1.90 to $2.00 per weighted average common share and unit.

See “Non-GAAP Financial Measures” for a complete definition of FFO and AFFO and the financial table accompanying this press release for reconciliations of net income to FFO and AFFO.

Commenting on the 2019 guidance, Mr. Witherell added, “Our initial outlook for the year reflects the significant work we accomplished in 2018 that added embedded growth to our portfolio through acquisition activity and strong new and renewal leasing as well as the sourcing of attractive capital through the strategic investment with Madison International Realty. These expected results at the midpoint of our range would represent strong dividend coverage with Nareit FFO and AFFO per share nearly double what we achieved in 2018.”

 

 

A reconciliation of projected net loss per weighted average common share and unit outstanding to projected Nareit FFO attributable to common stockholders and unit holders per weighted average common share and unit and AFFO per weighted average common share and unit is provided as follows:

   Full Year 
   2019 Range 
   Low   High 
Net loss  $(1.87)  $(1.77)
Add: Real estate depreciation & amortization   5.43    5.43 
Less: Preferred stock dividends   (1.06)   (1.06)
FFO attributable to common stockholders and unit holders   2.50    2.60 
Deferred finance fee amortization   0.19    0.19 
Stock compensation   0.16    0.16 
Straight-line rent   (0.08)   (0.09)
Above/below market lease rents   (0.21)   (0.23)
Recurring capital expenditures   (0.66)   (0.63)
AFFO attributable to common stockholders and unit holders  $1.90   $2.00 

The Company’s guidance for net loss, FFO attributable to common stockholders and unit holders and AFFO attributable to common stockholders and unit holders for 2019 is based on the following assumptions and does not include the potential impact of future acquisitions or dispositions, if completed:

Total revenues of $65.4 million to $66.0 million
Net operating income of $43.2 million to $43.6 million
EBITDA of $35.9 million to $36.5 million
General and administrative expenses of $7.0 to $7.3 million, including non-cash expenses of $1.0 million
Same-store portfolio occupancy of 95% to 96%
Recurring capital expenditures of $3.2 million to $3.7 million
5.9 million common shares and operating partnership units outstanding

 

Earnings Conference Call and Webcast

The Company will host a conference call and live audio webcast, both open for the general public to hear, later today at 1:00 p.m. Eastern Time. The number to call for this interactive teleconference is (412) 717-9587. A replay of the call will be available through March 15, 2019, by dialing (412) 317-0088 and entering the replay access code, 10128919.

 

The live audio webcast of the Company’s quarterly conference call will be available online in the Investor Relations section of the Company’s website at ir.plymouthreit.com. The online replay will be available approximately one hour after the end of the call and archived for approximately 90 days.

 

About Plymouth

Plymouth Industrial REIT, Inc. is a vertically integrated and self-managed real estate investment trust focused on the acquisition and operation of single and multi-tenant industrial properties located in secondary and select primary markets across the United States. The Company seeks to acquire properties that provide income and growth that enable the Company to leverage its real estate operating expertise to enhance shareholder value through active asset management, prudent property re-positioning and disciplined capital deployment.

 

 

Forward-Looking Statements

This press release includes “forward-looking statements” that are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release do not constitute guarantees of future performance. Investors are cautioned that statements in this press release, which are not strictly historical statements, including, without limitation, statements regarding management's plans, objectives and strategies, constitute forward-looking statements. Such forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statement, many of which may be beyond our control. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “seek,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe” or “continue” or the negative thereof or variations thereon or similar terminology. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

 

 

 

PLYMOUTH INDUSTRIAL REIT, INC.
CONSOLIDATED BALANCE SHEETS
UNAUDITED
(In thousands, except share and per share amounts)

 

   December 31,   December 31, 
   2018   2017 
Assets        
Real estate properties  $452,610   $303,402 
   Less accumulated depreciation   (41,279)   (25,013)
   Real estate properties, net   411,331    278,389 
           
Cash   5,394    12,915 
Cash held in escrow   7,808    5,074 
Restricted cash   1,759    1,174 
Deferred lease intangibles, net   37,940    27,619 
Other assets   5,931    4,782 
Total assets  $470,163   $329,953 
           
Liabilities, Preferred Stock and Equity          
Liabilities:          
Secured mortgage debt, net   288,993    195,431 
Mezzanine debt to investor, net       29,364 
Borrowings under line of credit, net   28,187    20,837 
Deferred interest       1,357 
Accounts payable, accrued expenses and other liabilities   21,996    16,015 
Deferred lease intangibles, net   7,067    6,807 
Total  Liabilities   346,243    269,811 
           
           
Preferred stock, par value $0.01 per share, 100,000,000 shares authorized,          
Series A; 2,040,000 shares issued and outstanding at December 31, 2018 and 2017 (aggregate liquidation preference of $51,000 at December 31, 2018 and 2017)   48,868    48,931 
Series B; 4,411,764 and no shares issued and outstandng at December 31, 2018 and 2017, respectively (aggregate liquidation preference of $75,000 at December 31, 2018)   72,192     
           
Equity (Deficit):          
Common stock, $0.01 par value: 900,000,000 shares authorized; 4,821,876 and 3,819,201 shares issued and outstanding at December 31, 2018 and December 31, 2017, respectively   49    39 
           
Additional paid in capital   126,327    123,270 
Accumulated deficit   (137,983)   (119,213)
Total stockholders' equity (deficit)   (11,607)   4,096 
Non-controlling interest   14,467    7,115 
Total equity (deficit)   2,860    11,211 
Total liabilities, preferred stock and equity  $470,163   $329,953 

 

 

 

PLYMOUTH INDUSTRIAL REIT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
(In thousands, except share and per share amounts)

 

   For the Three Months   For the Year 
   Ended December 31,   Ended December 31, 
   2018   2017   2018   2017 
Rental revenue  $10,387   $6,379   $36,632   $18,372 
Tenant recoveries   3,242    2,031    12,051    6,443 
Other revenue   8    1    534    3 
Total revenues   13,637    8,411    49,217    24,818 
                     
Operating expenses:                    
Property   4,860    3,122    17,449    8,205 
Depreciation and amortization   7,553    4,943    26,788    13,998 
General and administrative   1,733    2,031    6,032    5,189 
Acquisition costs       17        103 
Total operating expenses   14,146    10,113    50,269    27,495 
                     
Operating loss   (509)   (1,702)   (1,052)   (2,677)
                     
Other income (expense):                    
Interest expense   (3,957)   (3,219)   (15,734)   (11,581)
Loss on debt extinguishment   (988)       (5,393)    
Gain on sale of real estate   1,004        1,004     
Gain on disposition of equity investment       8        231 
Total other expense   (3,941)   (3,211)   (20,123)   (11,350)
                     
Net loss  $(4,450)  $(4,913)  $(21,175)  $(14,027)
                     
Net loss attributable to non-controlling interest  $(750)  $(489)  $(2,459)  $(5,320)
                     
Net loss attributable to Plymouth Industrial REIT, Inc.  $(3,700)  $(4,424)  $(18,716)  $(8,707)
                     
Less: Preferred stock dividends   1072    723    3,940    723 
Less: Series B preferred stock accretion to redemption value   359        359     
Less: amount allocated to participating securities   46    128    201    128 
                     
Net loss attributable to common shareholders  $(5,177)  $(5,275)  $(23,216)  $(9,558)
                     
Net loss per share attributable to Plymouth Industrial REIT, Inc.                    
common stockholders  $(1.10)  $(1.44)  $(5.76)  $(4.45)
                     
Weighted-average common shares outstanding basic and diluted   4,696,264    3,656,044    4,027,329    2,149,977 

 

 

Non-GAAP Financial Measures Definitions

Net Operating Income (NOI): We consider net operating income, or NOI, to be an appropriate supplemental measure to net income because it helps both investors and management understand the core operations of our properties. We define NOI as total revenue (including rental revenue, tenant reimbursements, management, leasing and development services revenue and other income) less property-level operating expenses including allocated overhead. NOI excludes depreciation and amortization, general and administrative expenses, impairments, gain/loss on sale of real estate, interest expense, and other non-operating items.

EBITDA: We believe that earnings before interest, taxes, depreciation and amortization, or EBITDA, is helpful to investors as a supplemental measure of our operating performance as a real estate company because it is a direct measure of the actual operating results of our industrial properties. We also use this measure in ratios to compare our performance to that of our industry peers.

Funds From Operations attributable to common stockholders (“FFO”): Funds from operations, or FFO, is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. We define FFO, consistent with the National Association of Real Estate Investment Trusts, or NAREIT, definition, as net income, computed in accordance with GAAP, excluding: gains (or losses) from sales of property, depreciation and amortization of real estate assets, impairment losses, losses on extinguishment of debt and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis. Other equity REITs may not calculate FFO as we do, and, accordingly, our FFO may not be comparable to such other REITs’ FFO. FFO should not be used as a measure of our liquidity, and is not indicative of funds available for our cash needs, including our ability to pay dividends.

In December 2018, NAREIT issued a white paper restating the definition of FFO. The purpose of the restatement was not to change the fundamental definition of FFO, but to clarify existing NAREIT guidance. The restated definition of FFO is a follows: Net Income (calculated in accordance with GAAP), excluding: (i) Depreciation and amortization related to real estate, (ii) Gains and losses from the sale of certain real estate assets, (iii) Gain and losses from change in control, and (iv) Impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. This restated definition does not give reference to the add back of loss on extinguishment of debt. Commencing on January 1, 2019, we will adopt the restated definition of NAREIT FFO on a prospective basis and will exclude the add back of loss on debt extinguishment.

 

 

Adjusted Funds From Operations attributable to common stockholders (“AFFO”): Adjusted funds from operation, or AFFO, is presented in addition to FFO. AFFO is defined as FFO, excluding certain non-cash operating revenues and expenses, acquisition and transaction related costs for transactions not completed and recurring capitalized expenditures. Recurring capitalized expenditures includes expenditures required to maintain and re-tenant our properties, tenant improvements and leasing commissions. AFFO further adjusts FFO for certain other non-cash items, including the amortization or accretion of above or below market rents included in revenues, straight line rent adjustments, impairment losses, non-cash equity compensation and non-cash interest expense.

We believe AFFO provides a useful supplemental measure of our operating performance because it provides a consistent comparison of our operating performance across time periods that is comparable for each type of real estate investment and is consistent with management’s analysis of the operating performance of our properties. As a result, we believe that the use of AFFO, together with the required GAAP presentations, provide a more complete understanding of our operating performance.

As with FFO, our reported AFFO may not be comparable to other REITs’ AFFO, should not be used as a measure of our liquidity, and is not indicative of our funds available for our cash needs, including our ability to pay dividends.

 

 

PLYMOUTH INDUSTRIAL REIT, INC.
SUPPLEMENTAL RECONCILIATION OF NON-GAAP DISCLOSURES
UNAUDITED
(In thousands, except share and per share amounts)

   For the Three Months   For the Year 
   Ended December 31,   Ended December 31, 
NOI:  2018   2017   2018   2017 
Net loss  $(4,450)  $(4,913)  $(21,175)  $(14,027)
General and administrative   1,733    2,031    6,032    5,189 
Acquisition costs       17        103 
Depreciation and amortization   7,553    4,943    26,788    13,998 
Interest expense   3,957    3,219    15,734    11,581 
Loss on debt extinguishment   988        5,393     
Gain on sale of real estate   (1,004)       (1,004)    
Other expense (income)   (8)   (9)   (534)   (234)
NOI  $8,769   $5,288   $31,234   $16,610 
                     
                     
   For the Three Months   For the Year 
   Ended December 31,   Ended December 31, 
EBITDA:   2018    2017    2018    2017 
Net loss  $(4,450)  $(4,913)  $(21,175)  $(14,027)
Depreciation and amortization   7,553    4,943    26,788    13,998 
Interest expense   3,957    3,219    15,734    11,581 
Loss on debt extinguishment   988        5,393     
Gain on sale of real estate   (1,004)       (1,004)    
EBITDA  $7,044   $3,249   $25,736   $11,552 
                     
                     
   For the Three Months   For the Year 
   Ended December 31,   Ended December 31, 
FFO:   2018    2017    2018    2017 
Net loss  $(4,450)  $(4,913)  $(21,175)  $(14,027)
Depreciation and amortization   7,553    4,943    26,788    13,998 
Loss on extinguishment of debt   988        5,393     
Gain on sale of real estate   (1,004)       (1,004)    
Gain on disposition of equity investment       (8)       (231)
FFO:  $3,087   $22   $10,002   $(260)
Preferred stock dividends   (1,072)   (723)   (3,940)   (723)
FFO attributable to common stockholders and unit holders  $2,015   $(701)  $6,062   $(983)
                     
Weighted average common shares and units outstanding   5,774    4,027    4,723    1,784 
FFO attributable to common stockholders and unit holders per share  $0.35   $(0.17)  $1.28   $(0.55)
                     
                     
   For the Three Months   For the Year 
   Ended December 31,   Ended December 31, 
AFFO:   2018    2017    2018    2017 
FFO attributable to common stockholders and unit holders  $2,015   $(701)  $6,062   $(983)
Deferred finance fee amortization   290    259    1,482    868 
Non-cash interest expense   14    900    656    1,531 
Acquisition costs       17        103 
Stock compensation   203    192    805    435 
Straight line rent   (71)   (82)   (996)   (191)
Above/below market lease rents   (340)   (168)   (1,304)   (423)
Recurring capital expenditure (1)   (767)   (227)   (2,695)   (522)
AFFO:  $1,344   $190   $4,010   $818 
                     
Weighted average common shares and units outstanding   5,774    4,027    4,723    1,784 
AFFO per share  $0.23   $0.05   $0.85   $0.46 

 

(1) Excludes non-recurring capital expenditures of $777 and $818 for the three months ended December 31, 2018 and 2017, respectively, and $2,601 and $1,272 for the year ended December 31, 2018 and 2017, respectively.

(Back To Top)

Section 3: EX-99 (FOURTH QUARTER 2018 SUPPLEMENTAL)

 

 

Fourth Quarter 2018

Supplemental

 

 

 

 
Plymouth Industrial REIT, Inc.
Table of Contents

 

Introduction    
Management, Board of Directors & Investor Contacts   2
Executive Summary   3
Transaction Activity Since IPO   4
Capitalization Analysis   5
2019 Guidance   6
Financial Information    
Consolidated Balance Sheets (unaudited)   7
Consolidated Statements of Operations - GAAP (unaudited)   8
Same Store Net Operating Income (NOI)   9
NOI   10
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)   11
Funds from Operations (FFO) & Adjusted Funds from Operations (AFFO)   12
Debt Overview   13
Operational & Portfolio Information    
Property Overview - Square Feet & Occupancy   14
Market Summary   15
Leasing Activity   16
Lease Expiration Schedule   17
Appendix    
Glossary   18

 

  Forward looking statements:  This supplemental package contains forward-looking statements within the meaning of the U.S. federal securities laws. We make statements in this supplemental package that are forward-looking statements, which are usually identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans” “projects,” “seeks,” “should,” “will,” and variations of such words or similar expressions. Our forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based on the information currently available to us and on assumptions we have made. Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in or suggested by our forward-looking statements are reasonable, we can give no assurance that our plans, intentions, expectations, strategies or prospects will be attained or achieved and you should not place undue reliance on these forward-looking statements. Furthermore, actual results may differ materially from those described in the forward-looking statements and may be affected by a variety of risks and factors. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. Except as required by law, we are not obligated to, and do not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
  Definitions and reconciliations:  For definitions of certain terms used throughout this supplemental, including certain non-GAAP financial measures, see the Glossary on pages 18. For reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures, see pages 10-12.

 

4Q 2018 Supplemental

 1

 

 

Plymouth Industrial REIT, Inc.
Management, Board of Directors & Investor Contacts

 

Corporate
 
260 Franklin Street, Suite 700
Boston, Massachusetts 02110
617.340.3814
www.plymouthreit.com

 

Executive and Senior Management  
     
Jeffrey E. Witherell Pendleton P. White, Jr. Daniel C. Wright
Chief Executive Officer President and Chief Investment Executive Vice President
and Chairman Officer and Chief Financial Officer
     
     
Board of Directors    
     
Martin Barber Philip S. Cottone Richard J. DeAgazio
Independent Director Independent Director Independent Director
     
David G. Gaw Pendleton P. White, Jr. Jeffery E. Witherell
Independent Director President and Chief Investment Chief Executive Officer
  Officer and Chairman

 

Transfer Agent
 
Continental Stock Transfer & Trust Company
1 State Street, 30th Floor
New York, New York 10004
212.509.4000
 
Investor Relations
 
Tripp Sullivan
SCR Partners
615.760.1104
IR@plymouthREI.com

 

 

4Q 2018 Supplemental

 2

 

 

Plymouth Industrial REIT, Inc.
Executive Summary
 

Company overview: Plymouth Industrial REIT, Inc. (NYSE American: PLYM) is a vertically integrated and self-managed real estate investment trust focused on the acquisition and operation of single and multi-tenant industrial properties located in secondary and select primary markets across the United States. The Company seeks to acquire properties that provide income and growth that enable the Company to leverage its real estate operating expertise to enhance shareholder value through active asset management, prudent property re-positioning and disciplined capital deployment.

 

Unaudited          
          As of December 31, 2018
Select Portfolio Statistics          
             
Number of Properties         55
Square Footage         11,977,273
Occupancy         95.0%
Weighted Average Lease Term Remaining - years         3.2
           
Balance Sheet ($ in thousands)          
           
Cash          $            14,961
Gross Assets          $          532,507
Total Debt          $          321,658
Net Debt (Total Debt less Cash)          $          306,697
Net Debt / Gross Assets         57.6%

 

    For the year ended
December 31,
  For the three months ended
December 31,
Operating results ($ in thousands) 2018 2017   2018 2017
             
Total Revenue  $            49,217  $            24,818    $            13,637  $              8,410
Net Operating Income  $            31,234  $            16,610    $              8,769  $              5,288

 

2018 Capital Activity ($ in thousands)      
       
Increased secured line of credit agreement with KeyBank National   3/8/2018  $            45,000
Secured 10 year term loan with Minnesota Insurance   4/30/2018  $            21,500
Secured term loan with KeyBank   5/23/2018  $            35,700
Repaid Torchlight Mezzanine Loan   5/24/2018  $           (35,000)
Secured 10 year term loan with Transamerica Life Insurance Company   7/10/2018  $            78,000
Repaid MWG Portfolio Loan   7/10/2018  $           (79,800)
Issued 1,102,464 common shares @ $15.60 per share   7/23/2018  $            16,253
Paid down KeyBank Term Loan   7/25/2018  $             (4,064)
Issued 160,369 overalotment of common shares @ $15.60 per share   8/17/2018  $              2,502
Paid down KeyBank Term Loan   8/17/2018  $                (466)
Issued 626,011 of operating units as part of the Fisher Park acquisition   10/15/2018  $            10,642
Issued 4,411,764 shares of Series B Preferred Stock   12/14/2018  $            75,000
Repaid remainder of KeyBank Term Loan    12/14/2018  $           (31,170)
Paid down Transamerica Term Loan as part of disposition of 525 Marquette   12/19/2018  $             (3,380)

 

4Q 2018 Supplemental

 3

 

 

Plymouth Industrial REIT, Inc.
Transaction Activity Since IPO
 
Unaudited ($ in thousands) (at 12/31/2018)

 

Acquisitions          
Location Acquisition Date # of Properties Purchase Price (1) Square Footage Projected Initial Yield
Jacksonville, FL 12/14/2018 3  $                 97,100 1,133,516 8.4%
Cincinnati, OH 10/15/2018 1                     24,800 1,100,000 8.5%
Cleveland, OH 9/27/2018 1                     27,000 400,184 7.6%
Elgin/Arlington Heights, IL 4/9/2018 2                     15,675 269,999 8.0%
Elgin, IL 12/22/2017 1                       4,050 75,000 9.7%
Atlanta. GA 12/21/2017 3                     11,425 330,361 8.3%
Multiple 11/30/2017 15                     99,750 3,027,987 8.1%
Memphis, TN 9/8/2017 1                       3,700 131,904 8.6%
Memphis, TN 8/16/2017 1                       7,825 235,000 10.5%
Columbus, OH 8/16/2017 1                       3,700 121,440 9.0%
Indianapolis, IN 8/11/2017 2                     16,875 606,871 8.5%
Southbend, IN 7/20/2017 5                     26,000 667,000 8.5%
           
 Total - Acquisitions   32  $              216,000 5,865,746  

 

Subsequent Acquisitions        
Location Acquisition Date # of Properties Purchase Price (1) Square Footage Projected Initial Yield
Chicago, IL 1/5/2019 1  $                   5,425 73,785 8.9%
           
Dispositions          
Location Disposition Date # of Properties Sale Price Square Footage Yield
Milwaukee, WI 12/19/2018 1  $                   5,300 112,144 6.5%

 

(1) Represents total direct consideration paid rather than GAAP cost basis.

 

4Q 2018 Supplemental

 4

 

 

Plymouth Industrial REIT, Inc.
Capitalization Analysis
 
Unaudited (in thousands except for per-share data and percentages)

 

      Three Months Ended
      12/31/2018 9/30/2018 6/30/2018 3/31/2018 12/31/2017
               
Common Stock Data            
               
  Weighted-Average Shares Outstanding - Basic   4,696 4,351 3,400 3,647 3,656
  Weighted-Average Shares Outstanding - Diluted   4,696 4,351 3,400 3,647 3,656
  High Closing Price    $                15.59  $                16.41  $                17.91  $                18.52  $                18.98
  Low Closing Price    $                11.45  $                14.63  $                15.09  $                16.25  $                17.22
  Average Closing Price    $                13.25  $                15.72  $                16.99  $                17.46  $                18.15
  Closing Price (as of period end)    $                12.61  $                15.50  $                16.00  $                17.18  $                18.48
  Dividends / Share (annualized) (1)    $                   1.50  $                   1.50  $                   1.50  $                   1.50  $                   1.50
  Dividend Yield (annualized) (2)   11.9% 9.7% 9.4% 8.7% 8.1%
  Common Shares Outstanding (2)   4,822 4,822 3,556 3,556 3,819
  Market Value of Common Shares (2)    $              60,804  $              74,739  $              56,896  $              61,092  $              70,579
  Total Market Capitalization (2) (3)    $            382,462  $            360,959  $            333,046  $            314,217  $            321,704

 

Equity Research Coverage (4)        
         
D.A. Davidson & Co.   Sandler O'Neill + Partners   Wedbush Securities
Barry Oxford   Alexander Goldfarb   Henry Coffey
646.885.5423   212.466.7937   212.833.1382

 

Investor Conference Call and Webcast:
The Company will hold a conference call and live audio webcast, both open for the general public to hear, on March 8, 2019 at 1:00 p.m. Eastern Time. The number to call for this interactive teleconference is (412) 717-9587. A replay of the call will be available through March 15, 2019 by dialing (412) 317-0088 and entering the replay access code, 10128919.

 

(1) Based on annualized dividend declared for the quarter.

(2) Based on closing price and ending shares for the last trading day of the quarter.

(3) Market value of shares plus total debt as of quarter end.

(4) The analysts listed provide research coverage on the Company. Any opinions, estimates or forecasts regarding the Company's performance made by these analysts are theirs alone and do not represent opinions, estimates or forecasts by the Company or its management. The Company does not by reference above imply its endorsement of or concurrence with such information, conclusions or recommendations.

 

4Q 2018 Supplemental

 5

 

 

Plymouth Industrial REIT, Inc.
2019 Guidance
 
Unaudited (in thousands, except per-share amounts)

 

    Full Year 2019 Range
    Low High
       
Net loss  $                     (1.87)  $                     (1.77)
       
Depreciation and amortization                           5.43                           5.43
Preferred stock dividend                          (1.06)                          (1.06)
FFO attributable to common stockholders and unit holders  $                       2.50  $                       2.60
       
Deferred finance fee amortization                           0.19                           0.19
Stock compensation                           0.16                           0.16
Straight line rent                          (0.08)                          (0.09)
Above/below market lease rents                          (0.21)                          (0.23)
Recurring capital expenditures (1)                          (0.66)                          (0.63)
AFFO  attributable to common stockholders and unit holders  $                       1.90  $                       2.00
       
Weighted average common shares and units outstanding                         5,900                         5,900
       
2019 Guidance Assumptions Low High
       
Total Revenue  $                   65,400  $                   66,000
NOI  $                   43,200  $                   43,600
EBITDA  $                   35,900  $                   36,500
G&A  $                     7,300  $                     7,000
Recurring CAPEX  $                     3,700  $                     3,200
Same store occupancy 95% 96%

 

4Q 2018 Supplemental

 6

 

 

Plymouth Industrial REIT, Inc.
Consolidated Balance Sheets (unaudited)
 
(in thousands)

 

             
    12/31/18 (1) 9/30/2018 6/30/2018 3/31/2018 12/31/17 (1)
Assets:          
Real estate properties:          
Land  $            92,628  $            66,563  $            63,688  $            59,799  $            59,797
Building and improvements        359,982        280,502        257,175        244,428        243,605
Less accumulated depreciation         (41,279)         (36,830)         (32,809)         (28,828)         (25,013)
             
Total real estate properties, net  $          411,331  $          310,235  $          288,054  $          275,399  $          278,389
             
             
Cash, cash held in escrow and restricted cash           14,961           11,557           12,128           13,097           19,163
Deferred lease intangibles, net           37,940           25,057           25,020           25,297           27,619
Other assets             5,931             6,409             7,430             5,284             4,782
             
Total assets  $          470,163  $          353,258  $          332,632  $          319,077  $          329,953
             
Liabilities:          
Debt, net  $          317,180  $          280,760  $          270,597  $          247,753  $          245,632
Deferred interest                   -                      -                      -                1,575             1,357
Accounts payable, accrued expenses and other liabilities           21,996           17,101           16,864           15,174           16,015
Deferred lease intangibles, net             7,067             6,439             6,657             6,261             6,807
             
Total liabilities  $          346,243  $          304,300  $          294,118  $          270,763  $          269,811
             
Preferred Stock - Series A  $            48,868  $            48,868  $            48,868  $            48,878  $            48,931
Preferred Stock - Series B  $            72,192  $                       -  $                       -  $                       -  $                       -
             
Equity:          
Common stock  $                    49  $                    49  $                    36  $                    36  $                    39
Additional paid in capital        126,327        129,392        114,085        116,183        123,270
Accumulated deficit       (137,983)       (134,283)       (129,982)       (123,277)       (119,213)
Total Plymouth Industrial REIT, Inc. stockholders' equity         (11,607)           (4,842)         (15,861)           (7,058)             4,096
Noncontrolling interest           14,467             4,932             5,507             6,494             7,115
             
Total equity  $              2,860  $                    90  $          (10,354)  $                (564)  $            11,211
             
Total liabilities, preferred stock and equity  $          470,163  $          353,258  $          332,632  $          319,077  $          329,953

 

(1) Audited consolidated financial statements and notes for the years ended December 31, 2018 and 2017 are available within our 2018 Annual Report on Form 10-K.

 

4Q 2018 Supplemental

 7

 

 

Plymouth Industrial REIT, Inc.
Consolidated Statements of Operations - GAAP (unaudited)
 
(in thousands, except per-share amounts)

 

    Three Months Ended
    12/31/18 (1) 9/30/2018 6/30/2018 3/31/2018 12/31/17 (1)  
Revenues:              
Rental income   $          10,387 $            8,742 $            9,019 $            8,483 $            6,379  
Tenant recoveries             3,242           2,906           2,957           2,946           2,031  
Other revenue                     8                   5                 71               450                   1  
               
Total revenues   $          13,637 $          11,653 $          12,047 $          11,879 $            8,411  
               
Operating expenses:              
Property related             4,860           4,349           3,787           4,452           3,122  
Depreciation and amortization             7,553           6,249           6,444           6,542           4,943  
General and administrative             1,733           1,394           1,533           1,373           2,031  
Acquisition costs                      -                    -                    -                    -                 17  
               
Total operating expenses   $          14,146 $          11,992 $          11,764 $          12,367 $          10,113  
               
Operating income   $             (509) $             (339) $               283 $             (488) $          (1,702)  
               
Other income (expense):              
Gain on sale of real estate             1,004                    -                    -                    -                    -  
Gain on disposition of equity investment                      -                    -                    -                    -                   8  
Interest expense            (3,957)          (3,575)          (4,216)          (3,985)          (3,219)  
Loss on debt extinguishment               (988)             (804)          (3,601)                    -                    -  
               
Total other income (expense)   $          (3,941) $          (4,379) $          (7,817) $          (3,985) $          (3,211)  
               
Net loss   $          (4,450) $          (4,718) $          (7,534) $          (4,473) $          (4,913)  
               
Less: Net income attributable to noncontrolling interest               (750)             (417)             (829)             (463)             (489)  
               
Net loss attributable to Plymouth Industrial REIT, Inc.   $          (3,700) $          (4,301) $          (6,705) $          (4,010) $          (4,424)  
               
Less: Series A preferred stock dividends             1,072               956               956               956               723 (2)
Less: Series B accretion to redemption value                 359                    -                    -                    -                    -  
Less: Amount allocated to participating securities                   46                 48                 46                 61               128  
               
Net income (loss) attributable to common stockholders   $             (5,177) $             (5,305) $             (7,707) $             (5,027) $             (5,275)  
               
Net income (loss) attributable to common stockholders per share - basic and diluted   $               (1.10) $               (1.22) $               (2.27) $               (1.38) $               (1.44)  
               
Weighted-average shares outstanding - basic & diluted   4,696 4,351 3,400 3,647 3,656  
               

 

(1) Audited consolidated financial statements and notes for the years ended December 31, 2018 and 2017 are available within our 2018 Annual Report on Form 10-K.

(2) Preferred stock dividend for the fourth quarter of 2017 of $0.46875, which was pro-rated to $0.3542 per share to reflect the period commencing October 25, 2017 (original issue date) and ending December 31, 2017, was declared in December 2017 and paid in January 2018.

 

4Q 2018 Supplemental

 8

 

 

Plymouth Industrial REIT, Inc.
Same Store Net Operating Income (NOI)
 
Unaudited (in thousands)

 

Trailing five quarter same store NOI Three Months Ended
  12/31/2018 9/30/2018 6/30/2018 3/31/2018 12/31/2017
Same store properties 30 30 30 30 30
           
Revenues:          
Rental income  $                5,066  $                     5,065  $                     5,154  $                     5,166  $                     5,324
Tenant recoveries                    1,849                         1,745                         1,872                         1,846                         1,740
Total operating revenues  $                6,915  $                     6,810  $                     7,026  $                     7,012  $                     7,064
           
Property expenses  $                2,730  $                     2,600  $                     2,135  $                     2,737  $                     2,758
           
Same store net operating income  $                4,185  $                     4,210  $                     4,891  $                     4,275  $                     4,306

 

Trailing two quarter same store NOI Three Months Ended
  12/31/2018 9/30/2018
Same store properties 50 50
     
Revenues:    
Rental income  $                8,683  $                     8,651
Tenant recoveries                    2,920                         2,897
Total operating revenues  $              11,603  $                   11,548
     
Property expenses  $                4,441  $                     4,227
     
Same store net operating income  $                7,162  $                     7,321

 

4Q 2018 Supplemental

 9

 

 

Plymouth Industrial REIT, Inc.
NOI
 
Unaudited (in thousands)

 

  Three Months Ended
  12/31/2018 9/30/2018 6/30/2018 3/31/2018 12/31/2017
           
Net loss  $              (4,450)  $                   (4,718)  $                   (7,534)  $                   (4,473)  $                   (4,913)
           
General and administrative                    1,733                         1,394                         1,533                         1,373                         2,031
Acquisition costs                             -                                  -                                  -                                  -                               17
Depreciation and amortization                    7,553                         6,249                         6,444                         6,542                         4,943
Interest expense                    3,957                         3,575                         4,216                         3,985                         3,219
Loss on debt extinguishment                        988                             804                         3,601                                  -                                  -
Gain on sale of real estate                   (1,004)                                  -                                  -                                  -                                  -
Other income                           (8)                                (5)                             (71)                           (450)                                (9)
           
Net Operating Income  $                8,769  $                     7,299  $                     8,189  $                     6,977  $                     5,288

 

4Q 2018 Supplemental

 10

 

 

Plymouth Industrial REIT, Inc.
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
 
Unaudited (in thousands)

 

  Three Months Ended
  12/31/2018 9/30/2018 6/30/2018 3/31/2018 12/31/2017
           
Net loss  $              (4,450)  $                   (4,718)  $                   (7,534)  $                   (4,473)  $                   (4,913)
           
Depreciation and amortization                    7,553                         6,249                         6,444                         6,542                         4,943
Interest expense                    3,957                         3,575                         4,216                         3,985                         3,219
Gain on sale of real estate                   (1,004)                                  -                                  -                                  -                                  -
Loss on debt extinguishment                        988                             804                         3,601                                  -                                  -
           
EBITDA  $                7,044  $                     5,910  $                     6,727  $                     6,054  $                     3,249

 

4Q 2018 Supplemental

 11

 

 

Plymouth Industrial REIT, Inc.
Funds from Operations (FFO) & Adjusted Funds from Operations (AFFO)
 
Unaudited (in thousands, except per-share amounts)

 

  Three Months Ended
  12/31/2018 9/30/2018 6/30/2018 3/31/2018 12/31/2017
           
Net loss  $                (4,450)  $                   (4,718)  $                   (7,534)  $                   (4,473)  $                   (4,913)
           
Depreciation and amortization                       7,553                         6,249                         6,444                         6,542                         4,943
Loss on debt extinguishment                          988                             804                         3,601                                  -                                  -
Gain on sale of real estate                     (1,004)                                  -                                  -                                  -                                  -
Gain on disposition of equity investment                               -                                  -                                  -                                  -                                (8)
           
FFO  $                  3,087  $                     2,335  $                     2,511  $                     2,069  $                           22
           
Preferred stock dividend                     (1,072)                           (956)                           (956)                           (956)                           (723)
FFO attributable to common stockholders and unit holders  $                  2,015  $                     1,379  $                     1,555  $                     1,113  $                      (701)
           
Deferred finance fee amortization                          290                             338                             466                             387                             259
Non-cash interest expense                            14                           (164)                             560                             247                             900
Acquisition costs                             -                                   -                                   -                                   -                                  17
Stock compensation                          203                             203                             200                             200                             192
Straight line rent                           (71)                           (107)                           (461)                           (357)                             (82)
Above/below market lease rents                        (340)                           (247)                           (306)                           (411)                           (168)
Recurring capital expenditures (1)                        (767)                           (598)                           (349)                           (982)                           (227)
AFFO  $                  1,344  $                        804  $                     1,665  $                        197  $                        190
           
Weighted average common shares and units outstanding                       5,774                         4,898                         3,977                         4,232                         4,234
           
FFO attributable to common stockholders and unit holders per share  $                    0.35  $                       0.28  $                       0.39  $                       0.26  $                     (0.17)
           
AFFO attributable to common stockholders and unit holders per share  $                    0.23  $                       0.16  $                       0.42  $                       0.05  $                       0.04

 

(1) Excludes non-recurring capital expenditures of $777, $576, $874, $373 and $819 for the three months ending December 31, September 30, June 30, March 31, 2018 and December 31, 2017, respectively.

 

4Q 2018 Supplemental

 12

 

 

Plymouth Industrial REIT, Inc.
Debt Overview
 
Unaudited ($ in thousands) at 12/31/2018

 

Debt Instrument - Secured Facility Maturity Rate Rate Type Properties Encumbered Balance % of Total Debt
$45.0 million line of credit   August-20  5.4%(1) Floating 8  $                   28,550 8.9%
$63.1 million KeyBank Term Loan   March-19 4.44% (2) Floating 3  $                   63,115 19.6%
$120.0 million AIG Loan   October-23 4.08% Fixed 20  $                 120,000 37.3%
$21.5 million Minnesota Life Loan   May-28 3.78% Fixed 6  $                   21,500 6.7%
$78.0 million Transamerica Secured Term Loan   August-28 4.35% Fixed 17  $                   74,620 23.2%
$13.9 million PNC Mortgage   January-27 5.23% Fixed 1  $                   13,873 4.3%
          55  $                321,658 100.0%

 

Fixed Debt ($ in thousands) at 12/31/2018      
Total fixed debt      $                 229,993
Weighted average interest rate of fixed debt     4.21%

 

Balance Sheet ($ in thousands) at 12/31/2018      
 Cash      $                   14,961
 Gross Assets (3)      $                 532,507
 Total Debt      $                 321,658
 Net Debt      $                 306,697

 

(1) Interest rate paid for the month of December 31, 2018. Borrowings under the Line of Credit Agreement bear interest at either (1) the base rate (determined from the highest of (a) KeyBank’s prime rate, (b) the federal funds rate plus 0.50% and (c) the one month LIBOR rate plus 1.0%) or (2) LIBOR, plus, in either case, a spread between 250 and 300 basis points depending on our total leverage ratio.

(2) Interest rate for the month of December 31, 2018. Borrowings under the KeyBank Bridge Loan bear interest at either (1) LIBOR plus 2% or (2) KeyBank’s base rate plus 1%.

(3) The carrying amount of total assets plus accumulated depreciation and amortization, as reported in the Company's consolidated financial statements.

 

4Q 2018 Supplemental

 13

 

 

Plymouth Industrial REIT, Inc.
Property Overview - Square Feet & Occupancy
 
Unaudited ($ in thousands) at 12/31/18

 

         
 Property  Market  Rentable Square Feet  Leased Square Feet  Occupancy
  32 Dart Road Atlanta 194,800 194,800 100.0%
  1665 Dogwood Drive SW Atlanta 198,000 198,000 100.0%
  1715 Dogwood Drive Atlanta 100,000 100,000 100.0%
  11236 Harland Drive Atlanta 32,361 32,361 100.0%
Subtotal - Atlanta   525,161 525,161 100.0%
  11351 W 183rd Street Chicago 18,768 18,768 100.0%
  11601 Central Avenue Chicago 260,000 260,000 100.0%
  13040 South Pulaski Avenue Chicago 395,466 395,466 100.0%
  1355 Holmes Road Chicago 82,456 82,456 100.0%
  13970 West Laurel Drive Chicago 70,196 70,196 100.0%
  1455-1645 Greenleaf Avenue Chicago 150,000 150,000 100.0%
  1600 Fleetwood Drive Chicago 247,000 247,000 100.0%
  1750 South Lincoln Drive Chicago 499,200 499,200 100.0%
  1796 Sherwin Avenue Chicago 98,879 98,879 100.0%
  1875 Holmes Road Chicago 134,415 134,415 100.0%
  189 Seegers Road Chicago 25,000 25,000 100.0%
  2401 Commerce Drive Chicago 78,574 78,574 100.0%
  28160 North Keith Drive Chicago 77,924 77,924 100.0%
  3 West College Drive Chicago 33,263 33,263 100.0%
  3841-3865 Swanson Court Chicago 99,625 99,625 100.0%
  3940 Stern Avenue Chicago 146,798 146,798 100.0%
  440 South McLean Chicago 74,613 74,613 100.0%
  6000 West 73rd Street Chicago 148,091 148,091 100.0%
  6510 West 73rd Street Chicago 306,552 306,552 100.0%
  6558 West 73rd Street Chicago 301,000 301,000 100.0%
  6751 Sayre Avenue Chicago 242,690 242,690 100.0%
  7200 Mason Ave Chicago 207,345 207,345 100.0%
  5110 South 6th Street Milwaukee 58,500 58,500 100.0%
Subtotal - Chicago   3,756,355 3,756,355 100.0%
  Mosteller Distribution Center Cincinnati 358,386 358,386 100.0%
  4115 Thunderbird Lane Cincinnati 70,000 70,000 100.0%
  Fisher Industrial Park Cincinnati 1,071,600 995,686 92.9%
Subtotal - Cincinnati   1,499,986 1,424,072 94.9%
  1755 Enterprise Parkway Cleveland 255,570 255,570 100.0%
  30339 Diamond Parkway Cleveland 400,184 400,184 100.0%
Subtotal - Cleveland   655,754 655,754 100.0%
  3500 Southwest Boulevard Columbus 527,127 527,127 100.0%
  3100 Creekside Parkway Columbus 340,000 - 0.0%
  8288 Green Meadows Dr. Columbus 300,000 300,000 100.0%
  8273 Green Meadows Dr. Columbus 77,271 77,271 100.0%
  7001 American Pkwy Columbus 54,100 54,100 100.0%
  2120 - 2138 New World Drive Columbus 121,200 121,200 100.0%
Subtotal - Columbus   1,419,698 1,079,698 76.1%
  3035 North Shadeland Ave Indianapolis 562,497 537,497 95.6%
  3169 North Shadeland Ave Indianapolis 44,374 41,960 94.6%
  5861 W Cleveland Road South Bend 62,550 62,550 100.0%
  West Brick Road South Bend 101,450 101,450 100.0%
  4491 N Mayflower Road South Bend 77,000 77,000 100.0%
  5855 West Carbonmill Road South Bend 198,000 198,000 100.0%
  4955 Ameritech Drive South Bend 228,000 228,001 100.0%
Subtotal - Indianapolis/South Bend   1,273,871 1,246,458 97.8%
  Center Point Business Park Jacksonville 537,800 504,882 93.9%
  Liberty Business Park Jacksonville 426,916 426,916 100.0%
  Salisbury Business Park Jacksonville 168,800 168,890 100.1%
Subtotal - Jacksonville   1,133,516 1,100,688 97.1%
  6005, 6045 & 6075 Shelby Dr. Memphis 202,303 202,303 100.0%
  210 American Dr. Jackson 638,400 638,400 100.0%
  3635 Knight Road Memphis 131,904 131,904 100.0%
  Business Park Drive Memphis 235,006 134,457 57.2%
Subtotal - Memphis/Jackson   1,207,613 1,107,064 91.7%
  7585 Empire Drive Florence, KY 148,415 148,415 100.0%
  56 Milliken Road Portland, ME 200,625 200,625 100.0%
  4 East Stow Road Marlton, NJ 156,279 139,959 89.6%
Subtotal - Others   505,319 488,999 96.8%
 Total - All Properties   11,977,273 11,384,249 95.0%
         

 

4Q 2018 Supplemental

 14

 

 

Plymouth Industrial REIT, Inc.
Market Summary
 
Unaudited (SF and $ in thousands) (at 12/31/2018)

 

Geography  State  Properties  Total
Acquisition
Cost (1)
Gross
Real Estate
Assets (2)
 % Gross
Real Estate
Assets
 Atlanta   GA 4 $                    17,045 $       15,839 3.5%
 Chicago   IL, WI 23 149,910 139,588 30.9%
 Cincinnati   OH 3 39,700 35,653 7.9%
 Cleveland   OH 2 42,000 40,081 8.9%
 Columbus   OH 6 50,982 48,841 10.8%
 Indianapolis/South Bend   IN 7 43,450 38,553 8.5%
 Jacksonville   FL 3 97,100 85,987 19.0%
 Memphis/Jackson   TN 4 31,608 26,556 5.9%
 Other   Various 3 24,000 21,186 4.7%
 Total   55 $                  495,795 $     452,284 100%

 

 

 

 

(1) Total acquisition cost prior to allocations per US GAAP.

(2) The gross book value of real estate assets as of December 31, 2018 excluding $326 in leasehold improvements related to our Corporate office. Gross book value of real estate assets excludes depreciation and the allocation of the acquisition cost towards intangible asset and liabilities required by US GAAP.

 

4Q 2018 Supplemental

 15

 

 

Plymouth Industrial REIT, Inc.
Leasing Activity
 
 

 

Year Type Square
Footage
Percent Expiring
Rent
New
Rent
% Change Tenant
Improvements
$/SF/YR
Lease
Commissions
$/SF/YR
                 
2017 Renewals 234,679 84.1%  $        4.25  $         4.51 6.2%  $              0.07  $                 0.13
  New Leases 44,268 15.9%  $        2.16  $         3.00 38.7%  $              0.41  $                 0.27
  Total 278,947 100%  $        3.92  $         4.27 9.1%  $              0.13  $                 0.15
                 
Q1 2018 Renewals 146,798 47.5%  $        4.25  $         4.30 1.2%  $                   -     $                 0.11
  New Leases 162,119 52.5%  $        3.17  $         3.99 26.0%  $              0.09  $                 0.04
  Total 308,917 100%  $        3.68  $         4.07 10.7%  $              0.05  $                 0.07
                 
Q2 2018 Renewals 146,874 18.1%  $        4.83  $         5.00 3.6%  $              0.14  $                 0.13
  New Leases 664,828 81.9%  $        2.80  $         2.99 6.8%  $              0.42  $                 0.25
  Total 811,702 100%  $        3.17  $         3.36 6.0%  $              0.37  $                 0.23
                 
Q3 2018 Renewals 101,287 46.9%  $      11.75  $         9.94 -15.4%  $              0.76  $                 0.26
  New Leases 114,580 53.1%  $        2.83  $         4.15 46.9%  $              0.63  $                 0.27
  Total 215,867 100%  $        7.01  $         6.87 -2.1%  $              0.69  $                 0.26
                 
Q4 2018 Renewals 87,108 75.9%  $        3.35  $         3.60 7.7%  $              0.19  $                 0.03
  New Leases 27,680 24.1%  $        2.16  $         3.58 65.5%  $              0.32  $                 0.08
  Total 114,788 100%  $        3.06  $         3.60 17.6%  $              0.22  $                 0.04
                 
2018 Renewals 482,067 33.2%  $        5.84  $         5.57 -4.6%  $              0.24  $                 0.13
  New Leases 969,207 66.8%  $        2.85  $         3.31 16.4%  $              0.39  $                 0.21
  Total 1,451,274 100%  $        3.84  $         4.06 5.8%  $              0.34  $                 0.18
                 

 

4Q 2018 Supplemental

 16

 

 

Plymouth Industrial REIT, Inc.
Lease Expiration Schedule
 
Unaudited ($ in thousands) (at 12/31/2018)

 

Year Square Footage Annualized
Base Rent
(ABR) (1)
% of ABR
Expiring (2)
Available 593,022 $                      - -
2019 1,193,336 5,030 10.7%
2020 1,931,510 7,601 16.2%
2021 3,031,441 12,702 27.1%
2022 1,117,343 5,498 11.7%
2023 1,140,818 4,172 8.9%
Thereafter 2,969,803 11,898 25.4%
Total 11,977,273 $            46,901 100.0%

 

 

 

 

(1) Annualized base rent is calculated as monthly contracted base rent per the terms of such lease, as of December 31, 2018, multiplied by 12. Excludes rent abatements.

(2) Calculated as annualized base rent set forth in this table divided by total annualized base rent for the Company Portfolio as of December 31, 2018.

 

4Q 2018 Supplemental

 17

 

 

Plymouth Industrial REIT, Inc.
Glossary
 

Non-GAAP Financial Measures Definitions:

 

Net Operating Income (NOI): We consider net operating income, or NOI, to be an appropriate supplemental measure to net income because it helps both investors and management understand the core operations of our properties. We define NOI as total revenue (including rental revenue, tenant reimbursements, management, leasing and development services revenue and other income) less property-level operating expenses including allocated overhead. NOI excludes depreciation and amortization, general and administrative expenses, impairments, gain/loss on sale of real estate, interest expense, and other non-operating items.

 

EBITDA: We believe that earnings before interest, taxes, depreciation and amortization, or EBITDA, is helpful to investors as a supplemental measure of our operating performance as a real estate company because it is a direct measure of the actual operating results of our industrial properties. We also use this measure in ratios to compare our performance to that of our industry peers.

 

Funds From Operations attributable to common stockholders and unit holders (“FFO”): Funds from operations, or FFO, is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. We define FFO, consistent with the National Association of Real Estate Investment Trusts, or NAREIT, definition, as net income, computed in accordance with GAAP, excluding gains (or losses) from sales of property, depreciation and amortization of real estate assets, impairment losses, loss on extinguishment of debt and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis. Other equity REITs may not calculate FFO as we do, and, accordingly, our FFO may not be comparable to such other REITs’ FFO. FFO should not be used as a measure of our liquidity, and is not indicative of funds available for our cash needs, including our ability to pay dividends.

In December 2018, NAREIT issued a white paper restating the definition of FFO. The purpose of the restatement was not to change the fundamental definition of FFO, but to clarify existing NAREIT guidance. The restated definition of FFO is a follows: Net Income (calculated in accordance with GAAP), excluding: (i) Depreciation and amortization related to real estate, (ii) Gains and losses from the sale of certain real estate assets, (iii) Gain and losses from change in control, and (iv) Impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. This restated definition does not give reference to the add back of loss on extinguishment of debt. Commencing on January 1, 2019, we will adopt the restated definition of NAREIT FFO on a prospective basis and will exclude the add back of loss on debt extinguishment.

 

Adjusted Funds From Operations attributable to common stockholders and unit holders (“AFFO”): Adjusted funds from operation, or AFFO, is presented in addition to FFO. AFFO is defined as FFO, excluding certain non-cash operating revenues and expenses, acquisition and transaction related costs for transactions not completed and recurring capitalized expenditures. Recurring capitalized expenditures includes expenditures required to maintain and re-tenant our properties, tenant improvements and leasing commissions. AFFO further adjusts FFO for certain other non-cash items, including the amortization or accretion of above or below market rents included in revenues, straight line rent adjustments, impairment losses, non-cash equity compensation and non-cash interest expense. We believe AFFO provides a useful supplemental measure of our operating performance because it provides a consistent comparison of our operating performance across time periods that is comparable for each type of real estate investment and is consistent with management’s analysis of the operating performance of our properties. As a result, we believe that the use of AFFO, together with the required GAAP presentations, provide a more complete understanding of our operating performance. As with FFO, our reported AFFO may not be comparable to other REITs’ AFFO, should not be used as a measure of our liquidity, and is not indicative of our funds available for our cash needs, including our ability to pay dividends.

 

Other Definitions:

 

GAAP: U.S generally accepted accounting principles.

 

Gross Assets: the carrying amount of total assets plus accumulated depreciation and amortization, as reported in the Company’s consolidated financial statements. For gross assets as of September 30, 2018 the calculation is as follows:

  12/31/2018
Total Assets $470,163
Add back accumulated depreciation 41,279
Add back intangible asset amortization 21,065
Gross assets $532,507
 

Non-Recurring Capital Expenditures: Non-recurring capital expenditures include capital expenditures of long lived improvements required to upgrade/replace existing systems or items that previously did not exist.

 

Occupancy: We define occupany as the percentage of total leasable square footage in which either the sooner of lease term commencement or revenue recognition in accordance to GAAP has commenced as of the close of the reporting period.

 

Recurring Capital Expenditures: Recurring capitalized expenditures includes capital expenditures required to maintain and re-tenant our properties, tenant improvements and leasing commissions.

 

Same Store Portfolio: Our Same Property Portfolio is a subset of our consolidated portfolio and includes properties that were wholly-owned by us for the entire period presented. The trailing 5 quarters same store portfolio includes properties owned as of October 1, 2017, and still owned by us as of December 31, 2018. Therefore, we excluded from our Same Store Portfolio any properties that were acquired or sold during the period from January 1, 2018 through December 31, 2018. The trailing 2 quarters same store portfolio includes properties owned as of July 1, 2018, and still owned by us as of December 31, 2018. Therefore, we excluded from our Same Store Portfolio any properties that were acquired or sold during the period from July 1, 2018 through December 31, 2018. The Company's computation of same store NOI may not be comparable to other REITs.

 

Weighted average lease term remaining: The average contractual lease term remaining as of the close of the reporting period (in years) weighted by square footage.

 

 

4Q 2018 Supplemental

 18

 

 

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