Press Release

VEREIT® Announces First Quarter 2017 Operating Results

Company Achieved Investment Grade By All Three Major Rating Agencies

Company Release - 5/4/2017 6:15 AM ET

PHOENIX, May 4, 2017 /PRNewswire/ -- VEREIT, Inc. (NYSE: VER) ("VEREIT" or the "Company") announced today its operating results for the three months ending March 31, 2017.

VEREIT is a leading, full-service real estate operating company with investment management capability that owns and actively manages a diversified portfolio of retail, restaurant, office and industrial assets. (PRNewsFoto/VEREIT, Inc.)

First Quarter 2017 Highlights

  • Net Income of $14.8 million and Net Loss per diluted share of $(0.00)
  • Achieved $0.19 AFFO per diluted share including $0.01 from Cole Capital
  • Completed $101.5 million of acquisitions and $199.2 million of dispositions
  • Decreased Debt from $6.4 billion to $6.3 billion and Net Debt from $6.1 billion to $6.0 billion
  • Reduced Net Debt to Normalized EBITDA from 5.7x to 5.5x
  • Cole Capital® raised $66.7 million of new equity capital

Credit Rating Updates

  • Moody's upgraded the credit rating of VEREIT from 'Ba1' to an investment grade rating of 'Baa3'
  • S&P raised its corporate credit rating of VEREIT from 'BB+' to an investment grade rating of 'BBB-', matching the bond rating
  • Fitch continues with an investment grade rating of 'BBB-'

First Quarter 2017 Consolidated Financial Results

Revenue
Consolidated revenue for the quarter ended March 31, 2017 decreased $21.0 million to $348.0 million as compared to revenue of $369.0 million for the same quarter in 2016, primarily due to 2016 dispositions.

Net Income (Loss) and Net Income (Loss) Attributable to Common Stockholders per Diluted Share
Consolidated net income for the quarter ended March 31, 2017 increased $130.9 million to net income of $14.8 million as compared to a net loss of $(116.1) million for the same quarter in 2016 and net loss per diluted share decreased $0.15 to $(0.00) for the quarter ended March 31, 2017, as compared to a net loss per diluted share of $(0.15) for the same quarter in 2016.  The  differences were primarily due to lower depreciation and amortization, interest expense, and impairment charges, offset by lower revenue, higher litigation and tax expenses and a smaller total gain on disposition of real estate and unconsolidated entities in the first quarter of 2017.

Normalized EBITDA
Consolidated Normalized EBITDA for the quarter ended March 31, 2017 decreased $15.3 million to $273.3 million as compared to Normalized EBITDA of $288.6 million for the same quarter in 2016, primarily due to 2016 dispositions.

Funds From Operations Attributable to Common Stockholders and Limited Partners ("FFO") and FFO per Diluted Share
FFO for the quarter ended March 31, 2017 decreased $26.1 million to $170.1 million, as compared to $196.2 million for the same quarter in 2016 and FFO per diluted share decreased $0.04 to $0.17 for the quarter ended March 31, 2017, as compared to $0.21 for the same quarter in 2016.

Adjusted FFO Attributable to Common Stockholders and Limited Partners ("AFFO") and AFFO per Diluted Share
AFFO for the quarter ended March 31, 2017 decreased $5.4 million to $187.3 million, as compared to $192.7 million for the same quarter in 2016, and AFFO per diluted share decreased $0.02 to $0.19 for the quarter ended March 31, 2017, as compared to $0.21 for the same quarter in 2016.

Common Stock Dividend Information
On May 3, 2017, the Company's Board of Directors declared a quarterly dividend of $0.1375 per share for the second quarter of 2017, representing an annual distribution rate of $0.55 per share. The dividend will be paid on July 17, 2017 to common stockholders of record as of June 30, 2017.

Balance Sheet and Liquidity
As of March 31, 2017, there was no balance outstanding on the Company's revolving line of credit. The Company's $2.8 billion unsecured credit facility is made up of a $500 million term loan and a revolving line of credit with $2.3 billion of capacity available. During the quarter, secured debt was reduced by $81.7 million.

Consolidated Financial Statistics
Consolidated Financial Statistics as of the quarter ended March 31, 2017 are as follows:  Net Debt to Normalized EBITDA of 5.5x, Fixed Charge Coverage Ratio of 2.9x, Unencumbered Gross Real Estate Assets to Total Gross Assets ratio of 67.2%, Net Debt to Gross Real Estate Assets of 39.0% and Weighted Average Debt Term of 4.2 years.    

Management Commentary
Glenn J. Rufrano, Chief Executive Officer, stated, "First quarter results were in-line with our expectations and provide a solid foundation for 2017. We successfully executed on acquisitions and dispositions - which reduced Red Lobster exposure to 7.4% - as well as maintained a strong and liquid balance sheet. Our ongoing accomplishments resulted in Moody's and S&P both upgrading the Company, and we are now investment grade with all three major ratings agencies. The size and diversity of our portfolio, combined with a single-tenant focus, have us well-positioned for today's evolving business environment."

Real Estate Investment ("REI") Segment Update

Real Estate Portfolio
As of March 31, 2017, the Company's portfolio consisted of 4,105 properties with total portfolio occupancy of 98.4%, investment grade tenancy of 41.6% and a weighted-average remaining lease term of 9.6 years.  During the quarter ended March 31, 2017, same-store rents (4,071 properties) decreased (0.3)% as compared to the same quarter in 2016.  Excluding the effects of the Ovation bankruptcy and last year's early renewal efforts, same store rents would have increased 0.3%.

Property Acquisitions
During the first quarter of 2017, the Company acquired 16 properties for approximately $81.1 million at an average cash cap rate of 7.1%. Additionally, we purchased the fee interest in three properties in which we held the leasehold interest for $20.4 million at an average cash cap rate of 5.5%.

Property Dispositions
During the quarter ended March 31, 2017, the Company sold 50 properties for approximately $199.2 million at an average cash cap rate of 7.3%, including $119.3 million in net sales of Red Lobster restaurants.  The gain on first quarter sales was approximately $12.5 million.

Cole Capital® Segment Update

Investment Management Capital Raise
During the quarter, Cole Capital raised $102.7 million of capital on behalf of its sponsored non-listed REITs (the "Cole REITs"), including $36.0 million through the Cole REITs' distribution reinvestment plans ("DRIP"), compared to $179.0 million, including $34.4 million of DRIP proceeds, in the first quarter of 2016.

Investment Management Acquisitions
Cole Capital invested $216.2 million in 21 properties on behalf of the Cole REITs in the first quarter of 2017, compared to $102.1 million in 13 properties in the first quarter of 2016.

Subsequent Events - Consolidated

Property Acquisitions
From April 1, 2017 through April 28, 2017, the Company acquired two properties for $14.6 million at an average cash cap rate of 6.7%.  Acquisitions year-to-date through April 28, 2017, totaled $116.1 million.  The average cash cap rate excluding the fee interest purchases was 7.0%.

Property Dispositions
From April 1, 2017 through April 28, 2017, the Company disposed of five properties for an aggregate sales price of $14.7 million at an average cash cap rate of 7.1%.  Dispositions year-to-date through April 28, 2017, totaled $213.9 million at an average cash cap rate of 7.3%.

Cole Capital Equity Raise
In April 2017, Cole Capital raised $36.6 million of capital on behalf of the Cole REITs, including $11.9 million through DRIP.

Audio Webcast Details

The live audio webcast, beginning at 1:00 p.m. ET on Thursday, May 4, 2017, is available by accessing this link:
http://ir.vereit.com/.  Participants should log in 10-15 minutes early.

Following the call, a replay of the webcast will be available at the link above and archived for up to 12 months following the call.

About the Company
VEREIT is a leading, full-service real estate operating company with investment management capability. VEREIT owns and actively manages a diversified portfolio of retail, restaurant, office and industrial real estate assets with a total asset book value of $15.4 billion including approximately 4,100 properties and 93.0 million square feet, located in 49 states, as well as Puerto Rico and Canada. Additionally, VEREIT manages $7.5 billion of gross real estate investments on behalf of the Cole Capital® non-listed REITs. VEREIT is a publicly traded Maryland corporation listed on the New York Stock Exchange. Additional information about VEREIT can be found on its website at www.VEREIT.com and through social media platforms such as Twitter and LinkedIn.

Definitions

Descriptions of FFO and AFFO, EBITDA and Normalized EBITDA, Debt Outstanding and Adjusted Debt Outstanding, Net Debt, Interest Expense, Excluding Non-Cash Amortization, Fixed Charge Coverage Ratio, Net Debt to Normalized EBITDA Annualized Ratio, Net Debt Leverage Ratio, and Unencumbered Asset Ratio are provided below. Refer to pages 7 through 12 for reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure and the calculations of these financial ratios.

Effective January 1, 2017, the Company determined certain non-GAAP measures and operating metrics, which include portfolio metrics,  should exclude the impact of properties owned by the Company for which as of the reporting date, (i) the related mortgage loan is in default, and (ii) management has made a decision to transfer the properties to the lender in connection with settling the mortgage note obligation ("Excluded Properties") to better reflect the ongoing operations of the Company. Excluded Properties at March 31, 2017, included one vacant office property and one vacant industrial property, comprising an aggregate of 578,000 square feet, which each secured a mortgage note payable, with aggregate Debt Outstanding of $41.8 million. The Company did not update data presented for prior periods as the impact on prior period non-GAAP measures, including AFFO and Normalized EBITDA, and operating metrics was immaterial.

Funds from Operations ("FFO") and Adjusted Funds from Operations ("AFFO")

Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts, Inc. ("NAREIT"), an industry trade group, has promulgated a supplemental performance measure known as FFO, which we believe to be an appropriate supplemental performance measure to reflect the operating performance of a REIT. FFO is not equivalent to our net income or loss as determined under GAAP.

NAREIT defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from disposition of property, depreciation and amortization of real estate assets and impairment write-downs on real estate including the pro rata share of adjustments for unconsolidated partnerships and joint ventures. We calculated FFO in accordance with NAREIT's definition described above.

In addition to FFO, we use AFFO as a non-GAAP supplemental financial performance measure to evaluate the operating performance of the Company. AFFO, as defined by the Company, excludes from FFO non-routine items such as acquisition-related expenses, litigation and other non-routine costs, gains or losses on sale of investment securities or mortgage notes receivable and legal settlements and insurance recoveries not in the ordinary course of business. We also exclude certain non-cash items such as impairments of goodwill and intangible assets, straight-line rental revenue, unrealized gains or losses on derivatives, reserves for loan loss, gains or losses on the extinguishment or forgiveness of debt, non-current portion of the tax benefit or expense, equity-based compensation and amortization of intangible assets, deferred financing costs, above-market lease assets and below-market lease liabilities. Effective January 1, 2017, we determined to omit the impact of the Excluded Properties and related non-recourse mortgage notes from AFFO. Management believes that excluding these costs from FFO provides investors with supplemental performance information that is consistent with the performance models and analysis used by management, and provides investors a view of the performance of our portfolio over time. AFFO allows for a comparison of the performance of our operations with other publicly-traded REITs, as AFFO, or an equivalent measure, is routinely reported by publicly-traded REITs, and we believe often used by analysts and investors for comparison purposes.

For all of these reasons, we believe FFO and AFFO, in addition to net income (loss), as defined by GAAP, are helpful supplemental performance measures and useful in understanding the various ways in which our management evaluates the performance of the Company over time. However, not all REITs calculate FFO and AFFO the same way, so comparisons with other REITs may not be meaningful. FFO and AFFO should not be considered as alternatives to net income (loss) and are not intended to be used as a liquidity measure indicative of cash flow available to fund our cash needs. Neither the SEC, NAREIT, nor any other regulatory body has evaluated the acceptability of the exclusions used to adjust FFO in order to calculate AFFO and its use as a non-GAAP financial performance measure.

Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") and Normalized EBITDA

Normalized EBITDA as disclosed represents EBITDA, or earnings before interest, taxes, depreciation and amortization, modified to exclude non-routine items such as acquisition-related expenses, merger and other non-routine transactions costs, gains or losses on sale of investments, legal settlements and insurance recoveries not in the ordinary course of business and extinguishment of debt cost. We also exclude certain non-cash items such as impairments of intangible assets, straight-line rental revenue, unrealized gains or losses on derivatives, write-off of program development costs, and amortization of intangibles, deferred financing costs, above-market lease assets and below-market lease liabilities. Beginning in 2017, Normalized EBITDA omits the Normalized EBITDA impact of Excluded Properties. Management believes that excluding these costs from EBITDA provides investors with supplemental performance information that is consistent with the performance models and analysis used by management, and provides investors a view of the performance of our portfolio over time. The Company believes that Normalized EBITDA is a useful non-GAAP supplemental measure to investors and analysts for assessing the performance of the Company's business segments. Therefore, Normalized EBITDA should not be considered as an alternative to net income, as computed in accordance with GAAP, or as an indicator of the Company's financial performance. The Company uses Normalized EBITDA as one measure of its operating performance when formulating corporate goals and evaluating the effectiveness of the Company's strategies. Normalized EBITDA may not be comparable to similarly titled measures of other companies.

Debt Outstanding and Adjusted Debt Outstanding

Debt Outstanding and Adjusted Debt Outstanding are non-GAAP measures that represent the Company's outstanding principal debt balance, excluding certain GAAP adjustments, such as premiums and discounts, financing and issuance costs, and related accumulated amortization. Beginning in 2017, Adjusted Debt Outstanding omits the outstanding principal balance of mortgage notes secured by Excluded Properties. We believe that the presentation of Debt Outstanding and Adjusted Debt Outstanding, which show our contractual debt obligations, provides useful information to investors to assess our overall liquidity, financial flexibility, capital structure and leverage. Debt Outstanding and Adjusted Debt Outstanding should not be considered as alternatives to the Company's consolidated debt balance as determined in accordance with GAAP or any other GAAP financial measures and should only be considered together with, and as a supplement to, the Company's financial information prepared in accordance with GAAP.

Net Debt

Net Debt is a non-GAAP measure used to show the Company's Adjusted Debt Outstanding, less all cash and cash equivalents. We believe that the presentation of Net Debt provides useful information to investors because our management reviews Net Debt as part of its management of our overall liquidity, financial flexibility, capital structure and leverage.

Interest Expense, Excluding Non-Cash Amortization

Interest Expense, Excluding Non-Cash Amortization is a non-GAAP measure that represents interest expense incurred on the outstanding principal balance of our debt.  This measure excludes (i) the amortization of deferred financing costs, premiums and discounts, which is included in interest expense in accordance with GAAP, and (ii) the impact of Excluded Properties and related non-recourse mortgage notes.  We believe that the presentation of Interest Expense, Excluding Non-Cash Amortization, which shows the interest expense on our contractual debt obligations, provides useful information to investors to assess our overall solvency and financial flexibility. Interest Expense, Excluding Non-Cash Amortization should not be considered as an alternative to the Company's interest expense as determined in accordance with GAAP or any other GAAP financial measures and should only be considered together with and as a supplement to the Company's financial information prepared in accordance with GAAP.

Fixed Charge Coverage Ratio

Fixed Charge Coverage Ratio is the sum of (i) Interest Expense, Excluding Non-Cash Amortization, (ii) secured debt principal amortization and (iii) dividends attributable to preferred shares, divided by Normalized EBITDA. Management believes that Fixed Charge Coverage Ratio is a useful supplemental measure of our ability to satisfy fixed financing obligations.

Net Debt to Normalized EBITDA Annualized Ratio

Net Debt to Normalized EBITDA Annualized equals Net Debt divided by the current quarter Normalized EBITDA multiplied by four. We believe that the presentation of Net Debt to Normalized EBITDA Annualized provides useful information to investors because our management reviews Net Debt to Normalized EBITDA Annualized as part of its management of our overall liquidity, financial flexibility, capital structure and leverage.

Net Debt Leverage Ratio

Net Debt Leverage Ratio equals Net Debt divided by Gross Real Estate Investments. We believe that the presentation of Net Debt Leverage Ratio provides useful information to investors because our management reviews Net Debt Leverage Ratio as part of its management of our overall liquidity, financial flexibility, capital structure and leverage.

Unencumbered Asset Ratio

Unencumbered Asset Ratio equals unencumbered Gross Real Estate Investments divided by Gross Real Estate Investments. Management believes that Unencumbered Asset Ratio is a useful supplemental measure of our overall liquidity and leverage.

Forward-Looking Statements

Information set forth herein (including information included or incorporated by reference herein) contains "forward-looking statements" (within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended), which reflect VEREIT's expectations regarding future events and VEREIT's future financial condition, results of operations and business, including its positioning and diversified portfolio. The forward-looking statements involve a number of assumptions, risks, uncertainties and other factors that could cause actual results to differ materially from those contained in the forward-looking statements. Generally, the words "expects," "anticipates," "assumes," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions identify forward-looking statements. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, most of which are difficult to predict and many of which are beyond VEREIT's control. If a change occurs, VEREIT's business, financial condition, liquidity and results of operations may vary materially from those expressed in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: VEREIT's plans, market and other expectations, objectives, intentions and other statements that are not historical facts; the developments disclosed herein; VEREIT's ability to execute on and realize success from its business plan; VEREIT's ability to meet its 2017 guidance; the unpredictability of the business plans and financial condition of VEREIT's tenants; the impact of impairment charges in respect of certain of VEREIT's properties or other assets; risks associated with pending government investigations and litigations related to VEREIT's previously disclosed audit committee investigation; the inability of Cole Capital to regain its prior level of capital raise; the ability to retain or hire key personnel; and continuation or deterioration of current market conditions. Additional factors that may affect future results are contained in VEREIT's filings with the U.S. Securities and Exchange Commission (the "SEC"), which are available at the SEC's website at www.sec.gov. VEREIT disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of changes in underlying assumptions or factors, new information, future events or otherwise, except as required by law.

VEREIT, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except for share and per share data) (Unaudited)




March 31,
2017


December 31,
2016

ASSETS





Real estate investments, at cost:





Land


$

2,868,447



$

2,895,625


Buildings, fixtures and improvements


10,630,598



10,644,296


Intangible lease assets


2,017,739



2,044,521


Total real estate investments, at cost


15,516,784



15,584,442


Less: accumulated depreciation and amortization


2,494,811



2,331,643


Total real estate investments, net


13,021,973



13,252,799


Investment in unconsolidated entities


45,145



46,077


Investment in direct financing leases, net


34,909



39,455


Investment securities, at fair value


42,630



47,215


Mortgage notes receivable, net


22,545



22,764


Cash and cash equivalents


285,586



256,452


Restricted cash


46,712



45,018


Intangible assets, net


20,464



24,609


Rent and tenant receivables and other assets, net


346,898



330,705


Goodwill


1,462,585



1,462,203


Due from affiliates


15,007



21,349


Real estate assets held for sale, net


12,081



38,928


Total assets


$

15,356,535



$

15,587,574







LIABILITIES AND EQUITY





Mortgage notes payable and other debt, net


$

2,586,917



$

2,671,106


Corporate bonds, net


2,227,307



2,226,224


Convertible debt, net


976,031



973,340


Credit facility, net


497,148



496,578


Below-market lease liabilities, net


217,721



224,023


Accounts payable and accrued expenses


135,817



146,137


Deferred rent, derivative and other liabilities


68,196



68,039


Distributions payable


165,765



162,578


Due to affiliates


7



16


Total liabilities


6,874,909



6,968,041


Commitments and contingencies





Preferred stock, $0.01 par value, 100,000,000 shares authorized and 42,834,138 issued and outstanding as of each of March 31, 2017 and December 31, 2016


428



428


Common stock, $0.01 par value, 1,500,000,000 shares authorized and 974,238,458 and 974,146,650 issued and outstanding as of March 31, 2017 and December 31, 2016, respectively


9,742



9,741


Additional paid-in-capital


12,642,099



12,640,171


Accumulated other comprehensive loss


(1,795)



(2,556)


Accumulated deficit


(4,338,029)



(4,200,423)


Total stockholders' equity


8,312,445



8,447,361


Non-controlling interests


169,181



172,172


Total equity


8,481,626



8,619,533


Total liabilities and equity


$

15,356,535



$

15,587,574


 

VEREIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except for per share data) (Unaudited)




Three Months Ended March 31,



2017


2016

Revenues:





Rental income


$

293,739


$

313,971

Direct financing lease income


433


569

Operating expense reimbursements


26,726


23,247

Cole Capital revenue


27,131


31,233

   Total revenues


348,029


369,020

Operating expenses:





Cole Capital reallowed fees and commissions


2,660


8,068

Acquisition-related


617


242

Litigation and other non-routine costs, net of insurance recoveries


12,875


(5,175)

Property operating


34,016


34,813

General and administrative


29,148


29,400

Depreciation and amortization


183,152


204,308

Impairments


6,725


160,517

   Total operating expenses


269,193


432,173

  Operating income (loss)


78,836


(63,153)

Other (expense) income:





Interest expense


(73,743)


(80,426)

Loss on extinguishment and forgiveness of debt, net


(70)


Other income, net


798


1,062

Equity in (loss) income and gain on disposition of unconsolidated entities


(82)


10,404

Gain (loss) on derivative instruments, net


824


(1,086)

  Total other expenses, net


(72,273)


(70,046)

Income (loss) before taxes and real estate dispositions


6,563


(133,199)

Gain on disposition of real estate and held for sale assets, net


12,481


17,175

Income (loss) before taxes


19,044


(116,024)

Provision for income taxes


(4,254)


(56)

Net income (loss)


14,790


(116,080)

Net (income) loss attributable to non-controlling interests


(352)


2,994

Net income (loss) attributable to the General Partner


$

14,438


$

(113,086)








Basic and diluted net loss per share attributable to common stockholders


$

(0.00)


$

(0.15)

Distributions declared per common share


$

0.14


$

0.14








 

VEREIT, INC.

CONSOLIDATED EBITDA AND NORMALIZED EBITDA

(In thousands) (Unaudited)




Three Months Ended March 31,



2017


2016

Net income (loss)


$

14,790


$

(116,080)

Adjustments:





  Interest expense


73,743


80,426

  Depreciation and amortization


183,152


204,308

  Provision for income taxes


4,254


56

  Proportionate share of adjustments for unconsolidated entities


1,246


1,822

 EBITDA


$

277,185


$

170,532

  Gain on disposition of real estate assets, including joint ventures, net


(12,481)


(27,373)

  Impairments


6,725


160,517

  Acquisition-related expenses


617


242

  Litigation and other non-routine costs, net of insurance recoveries


12,875


(5,175)

  (Gain) loss on derivative instruments, net


(824)


1,086

  Amortization of above-market lease assets and deferred lease incentives, net of amortization of below-market lease liabilities


1,305


1,296

  Loss on extinguishment and forgiveness of debt, net


70


  Net direct financing lease adjustments


621


559

  Straight-line rent, net of bad debt expense related to straight-line rent


(12,797)


(13,045)

  Other amortization and non-cash charges


861


(126)

   Proportionate share of adjustments for unconsolidated entities


(48)


94

  Adjustment for Excluded Properties


(764)


Normalized EBITDA


$

273,345


$

288,607




 

VEREIT, INC.

CONSOLIDATED FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS

(In thousands, except for share and per share data) (Unaudited)




Three Months Ended March 31,



2017


2016

Net income (loss)


$

14,790


$

(116,080)

Dividends on non-convertible preferred stock


(17,973)


(17,973)

Gain on real estate assets and interest in joint venture, net


(12,481)


(27,373)

Depreciation and amortization of real estate assets


178,295


195,991

Impairment of real estate


6,725


160,517

Proportionate share of adjustments for unconsolidated entities


709


1,147

FFO attributable to common stockholders and limited partners


$

170,065


$

196,229






Acquisition-related expenses


617


242

Litigation and other non-routine costs, net of insurance recoveries


12,875


(5,175)

(Gain) loss on derivative instruments, net


(824)


1,086

Amortization of premiums and discounts on debt and investments, net


(847)


(4,426)

Amortization of above-market lease assets and deferred lease incentives, net of amortization of below-market lease liabilities


1,305


1,296

Net direct financing lease adjustments


621


559

Amortization and write-off of deferred financing costs


6,347


7,307

Amortization of management contracts


4,146


7,451

Deferred tax expense (benefit)


1,649


(1,457)

Loss on extinguishment and forgiveness of debt, net


70


Straight-line rent, net of bad debt expense related to straight-line rent


(12,797)


(13,045)

Equity-based compensation expense


3,111


1,730

Other amortization and non-cash charges


634


743

Proportionate share of adjustments for unconsolidated entities


55


135

Adjustment for Excluded Properties


294


AFFO attributable to common stockholders and limited partners


$

187,321


$

192,675






Weighted-average shares outstanding - basic


973,849,610


903,825,726

Limited Partner OP Units and effect of dilutive securities


24,402,139


26,354,148

Weighted-average shares outstanding - diluted


998,251,749


930,179,874






FFO attributable to common stockholders and limited partners per diluted share


$

0.17


$

0.21

AFFO attributable to common stockholders and limited partners per diluted share


$

0.19


$

0.21








 

VEREIT, INC.

FINANCIAL AND OPERATIONS STATISTICS AND RATIOS

(Dollars in thousands) (Unaudited)




Three Months Ended



March 31,
2017

Interest expense, Excluding Non-Cash Amortization


$

68,123

Secured debt principal amortization


8,993

Dividends attributable to preferred shares


17,973

Total fixed charges


95,089

Normalized EBITDA


273,345

Fixed Charge Coverage Ratio


2.87x






March 31,
2017




Adjusted Debt Outstanding


$

6,277,388

Less: cash and cash equivalents


285,586

Net Debt


5,991,802

Normalized EBITDA annualized


1,093,380

Net Debt to Normalized EBITDA Annualized Ratio


5.48x




Net Debt


$

5,991,802

Gross Real Estate Investments


15,367,137

Net Debt Leverage Ratio


39.0%





Unencumbered Gross Real Estate Investments


$

10,319,871

Gross Real Estate Investments


15,367,137

Unencumbered asset ratio


67.2%






March 31,
2017

Mortgage notes payable and other debt, net


$

2,586,917

Corporate bonds, net


2,227,307

Convertible debt, net


976,031

Credit facility, net


497,148

Total debt - as reported


6,287,403

Adjustments:



Deferred financing costs, net


51,936

Net premiums


(20,131)

Debt Outstanding


$

6,319,208

Debt Outstanding - Excluded Properties


(41,820)

Adjusted Debt Outstanding


6,277,388






Three Months Ended



March 31,
2017

Interest expense - as reported


$

(73,743)

Less Adjustments:



Amortization of deferred financing and issuance costs


(6,443)

Amortization of net premiums


1,881

Interest Expense, Excluding Non-Cash Amortization - Excluded Properties


(1,058)

Interest Expense, Excluding Non-Cash Amortization


$

(68,123)

 

VEREIT, INC.

SEGMENT REPORTING - FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS

(Cole Capital Segment)

(In thousands, except for share and per share data) (Unaudited)




Three Months Ended March 31,



2017


2016

Net income (loss)


$

2,010


$

(546)

 FFO attributable to common stockholders and limited partners


2,010


(546)






Acquisition-related expenses



25

Amortization of management contracts


4,146


7,451

Deferred tax expense (benefit)


1,649


(1,457)

Equity-based compensation expense


1,447


931

Other amortization and non-cash charges


632


743

 AFFO attributable to common stockholders and limited partners


$

9,884


$

7,147





Weighted-average shares outstanding - basic


973,849,610


903,825,726

Limited Partner OP Units and effect of dilutive securities


24,402,139


26,354,148

Weighted-average shares outstanding - diluted


998,251,749


930,179,874





FFO attributable to common stockholders and limited partners per diluted share


$

0.002


$

(0.001)

AFFO attributable to common stockholders and limited partners per diluted share


$

0.010


$

0.008



 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/vereit-announces-first-quarter-2017-operating-results-300451285.html

SOURCE VEREIT, Inc.

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