CEDARHURST, N.Y.--(BUSINESS WIRE)--Postal Realty Trust, Inc. (NYSE:PSTL) (the “Company”), an internally managed real estate investment trust that owns and manages over 1,400 properties leased primarily to the United States Postal Service (the “USPS”), ranging from last mile post offices to larger industrial facilities, today announced results for the quarter and year ended December 31, 2021.
Highlights for the Quarter Ended December 31, 2021
- Acquired 55 properties for approximately $42.8 million, excluding closing costs
- Rental income increased 49% from fourth quarter 2020 to fourth quarter 2021, reflecting internal growth and accretive acquisitions
- Net income attributable to common shareholders was $0.8 million, or $0.04 per diluted share
- Funds from Operations ("FFO") was $4.8 million, or $0.24 per diluted share
- Adjusted Funds from Operations ("AFFO") was $4.9 million, or $0.25 per diluted share
- Raised approximately $83.1 million in gross proceeds from the sale of approximately 4.9 million shares of Class A common stock in an underwritten offering
- Increased quarterly dividend by approximately 4.6% from the prior year
Highlights for the Year Ended December 31, 2021
- Acquired 239 properties for approximately $118 million in 2021, excluding closing costs
- Rental income increased 64% from 2020 to 2021, reflecting internal growth and accretive acquisitions
- Net income attributable to common shareholders was $2.1 million, or $0.10 per diluted share
- FFO was $16.5 million, or $0.95 per diluted share
- AFFO was $18.2 million, or $1.05 per diluted share
- Paid aggregate dividends of $0.885 per share for calendar year 2021
- Entered into a new $150 million senior unsecured revolving credit facility and $50 million senior unsecured term loan
- Raised approximately $147 million in gross proceeds from the sale of Class A common stock
- Repaid $13.7 million of mortgages and reduced interest rates on several mortgage loans
“We are pleased to have delivered another year of strong transaction volume, surpassing $100 million of accretive acquisitions of USPS properties, most of which were sourced off-market. These properties further expand our portfolio of last mile, flex and industrial facilities which deliver durable cash flows, and contributed to our solid financial and operational performance in 2021,” stated Andrew Spodek, Chief Executive Officer. “As we move ahead, we will continue to invest in our platform to support our efforts to more effectively scale the business. Our position as a leading consolidator in the industry enables us to take advantage of this large, fragmented logistics network to build out our pipeline of opportunities in our efforts to maximize long-term value for shareholders.”
Property Portfolio & Acquisitions
The Company’s owned portfolio was 99.6% occupied, comprised of 966 properties across 49 states with approximately 4.5 million net leasable interior square feet and a weighted average rental rate of $8.09 per leasable square foot, as of December 31, 2021.
During the fourth quarter, the Company acquired 55 properties leased to the USPS for approximately $42.8 million, excluding closing costs, comprising approximately 731,000 net leasable interior square feet.
Balance Sheet & Capital Markets Activity
As of December 31, 2021, the Company had cash of $5.9 million on the balance sheet, and $89.3 million of net debt with a weighted average interest rate of 2.41%.
In November 2021, the Company raised approximately $83.1 million in gross proceeds from the sale of approximately 4.9 million shares of its Class A common stock in an underwritten offering. Proceeds were used for general corporate purposes.
Dividend
On February 1, 2022, the Company declared a quarterly dividend of $0.2275 per share of Class A common stock. The dividend equates to $0.91 per share on an annualized basis. This represents the tenth consecutive dividend increase since the Company’s IPO in 2019. The dividend was paid on February 28, 2022 to stockholders of record as of the close of business on February 15, 2022.
Subsequent Events
Subsequent to quarter end and through March 7, 2022, the Company acquired 38 properties comprising approximately 92,000 net leasable interior square feet for approximately $11.8 million, excluding closing costs. As of March 7, 2022, the Company had another 13 properties totaling approximately $13.5 million under definitive contracts.
On March 4, 2022, the Company acquired Real Estate Asset Counseling, a postal real estate consulting business, and its employees through the issuance of 79,794 OP Units and $225,000 in cash to complement the Company's core business of acquiring, managing, servicing and being a consolidator of postal properties.
Webcast and Conference Call Details
The Company will host a webcast and conference call to discuss the fourth quarter and full year 2021 financial results on Thursday, March 10, 2022 at 5:00 P.M. Eastern Time. A live audio webcast of the conference call will be available on the Company’s investor website at https://investor.postalrealtytrust.com/QuarterlyResults. To participate in the conference call, callers from the United States and Canada should dial-in ten minutes prior to the scheduled call time at 1-877-407-9208. International callers should dial 1-201-493-6784.
Replay
A telephonic replay of the call will be available starting at 8:00 P.M. Eastern Time on Thursday, March 10, 2022 through 11:59 P.M. Eastern Time on Thursday, March 24, 2022 by dialing 1-844-512-2921 in the United States and Canada or 1-412-317-6671 internationally. The passcode for the replay is 13727461.
Non-GAAP Supplemental Financial Information
An explanation of certain non-GAAP financial measures used in this press release, including, FFO and AFFO, as well as reconciliations of those non-GAAP financial measures, to the most directly comparable GAAP financial measure, is included below.
The Company calculates FFO in accordance with the current National Association of Real Estate Investment Trusts (“NAREIT”) definition. NAREIT currently defines FFO as follows: net income (loss) (computed in accordance with GAAP) excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and 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 an entity. Other REITs may not define FFO in accordance with the NAREIT definition or may interpret the current NAREIT definition differently than the Company does and therefore the Company’s computation of FFO may not be comparable to such other REITs.
The Company calculates AFFO by starting with FFO and adjusting for recurring capital expenditures (defined as all capital expenditures and, beginning with Q3 2020, leasing costs that are recurring in nature, excluding beginning with Q2 2020, as a policy change, all capital improvements that are planned at the acquisition of a property or obtaining a lease or lease renewal) and acquisition related expenses (defined as acquisition-related expenses that are incurred for investment purposes and do not correlate with the ongoing operations of the Company’s existing portfolio, including due diligence costs for acquisitions not consummated and certain auditing and accounting fees incurred that were directly related to completed acquisitions or dispositions) that are not capitalized and then adding back non-cash items including: loss on early extinguishment of debt, write-off and amortization of deferred financing fees, straight-line rent and other adjustments (beginning with Q3 2020, including lump sum catch up payments for increased rents), fair value lease adjustments, income on insurance recoveries from casualties (beginning with Q4 2020) and non-cash components of compensation expense. AFFO is a non-GAAP financial measure and should not be viewed as an alternative to net income calculated in accordance with GAAP as a measurement of the Company’s operating performance. The Company believes that AFFO is widely used by other REITs and is helpful to investors as a meaningful additional measure of the Company’s ability to make capital investments. Other REITs may not define AFFO in the same manner as the Company does and therefore the Company’s calculation of AFFO may not be comparable to such other REITs.
These metrics are non-GAAP financial measures and should not be viewed as an alternative measurement of the Company’s operating performance to net income. Management believes that accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. As a result, the Company believes that the additive use of FFO and AFFO, together with the required GAAP presentation, is widely-used by the Company’s competitors and other REITs and provides a more complete understanding of the Company’s performance and a more informed and appropriate basis on which to make investment decisions.
Forward-Looking and Cautionary Statements
This press release contains “forward-looking statements.” Forward-looking statements include statements identified by words such as “could,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “continues,” “projects” and similar references to future periods, or by the inclusion of forecasts or projections. Forward-looking statements, including, among others, statements regarding the Company’s anticipated growth and ability to obtain financing, renew or replace expiring leases and close on pending transactions on the terms or timing it expects, if at all, are based on the Company’s current expectations and assumptions regarding capital market conditions, the Company’s business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, the Company’s actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the USPS’ terminations or non-renewals of leases, changes in demand for postal services delivered by the USPS, the solvency and financial health of the USPS, competitive, financial market and regulatory conditions, disruption in market, economic and financial conditions as a result of the ongoing COVID-19 pandemic, general real estate market conditions, the Company’s competitive environment and other factors set forth under “Risk Factors” in the Company’s filings with the Securities and Exchange Commission. Any forward-looking statement made in this press release speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.
About Postal Realty Trust, Inc.
Postal Realty Trust, Inc. is an internally managed real estate investment trust that owns and manages over 1,400 properties leased primarily to the USPS. More information is available at postalrealty.com.
Postal Realty Trust, Inc.
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For the Three Months
|
|
For the Twelve Months
|
||||||||||||
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2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Revenues: |
|
|
|
|
|||||||||||
Rental income |
$ |
10,608 |
|
|
$ |
7,106 |
|
|
$ |
38,276 |
|
|
$ |
23,315 |
|
Fee and other |
|
525 |
|
|
|
312 |
|
|
|
1,662 |
|
|
|
1,129 |
|
Total revenues |
|
11,133 |
|
|
|
7,418 |
|
|
|
39,938 |
|
|
|
24,444 |
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Real estate taxes |
|
1,522 |
|
|
|
959 |
|
|
|
5,399 |
|
|
|
3,095 |
|
Property operating expenses |
|
1,279 |
|
|
|
663 |
|
|
|
3,987 |
|
|
|
1,924 |
|
General and administrative |
|
2,762 |
|
|
|
1,984 |
|
|
|
10,643 |
|
|
|
8,230 |
|
Depreciation and amortization |
|
3,859 |
|
|
|
2,572 |
|
|
|
13,990 |
|
|
|
9,163 |
|
Total operating expenses |
|
9,422 |
|
|
|
6,178 |
|
|
|
34,019 |
|
|
|
22,412 |
|
|
|
|
|
|
|
|
|
||||||||
Income from operations |
|
1,711 |
|
|
|
1,240 |
|
|
|
5,919 |
|
|
|
2,032 |
|
|
|
|
|
|
|
|
|
||||||||
Other income |
|
125 |
|
|
|
158 |
|
|
|
401 |
|
|
|
231 |
|
|
|
|
|
|
|
|
|
||||||||
Interest expense, net: |
|
|
|
|
|
|
|
||||||||
Contractual interest expense |
|
(739 |
) |
|
|
(588 |
) |
|
|
(2,739 |
) |
|
|
(2,346 |
) |
Write-off and amortization of deferred financing fees |
|
(129 |
) |
|
|
(129 |
) |
|
|
(714 |
) |
|
|
(472 |
) |
Loss on early extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
(202 |
) |
|
|
— |
|
Interest income |
|
1 |
|
|
|
1 |
|
|
|
2 |
|
|
|
3 |
|
Total interest expense, net |
|
(867 |
) |
|
|
(716 |
) |
|
|
(3,653 |
) |
|
|
(2,815 |
) |
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income tax expense |
|
969 |
|
|
|
682 |
|
|
|
2,667 |
|
|
|
(552 |
) |
Income tax expense |
|
(36 |
) |
|
|
(44 |
) |
|
|
(111 |
) |
|
|
(89 |
) |
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
|
933 |
|
|
|
638 |
|
|
|
2,556 |
|
|
|
(641 |
) |
Net (income) loss attributable to Operating Partnership unitholders’ non-controlling interests |
|
(181 |
) |
|
|
(148 |
) |
|
|
(501 |
) |
|
|
289 |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to common stockholders |
$ |
752 |
|
|
$ |
490 |
|
|
$ |
2,055 |
|
|
$ |
(352 |
) |
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share: |
|
|
|
|
|
|
|
||||||||
Basic and Diluted |
$ |
0.04 |
|
|
$ |
0.04 |
|
|
$ |
0.10 |
|
|
$ |
(0.10 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
||||||||
Basic and Diluted |
|
15,718,250 |
|
|
|
9,243,161 |
|
|
|
13,689,251 |
|
|
|
7,013,621 |
|
|
|
|
|
|
|
|
|
||||||||
Postal Realty Trust, Inc.
|
|||||||
|
December 31,
|
|
December 31,
|
||||
|
|
|
|
||||
Assets |
|
|
|
||||
Investments: |
|
|
|
||||
Real estate properties, at cost: |
|
|
|
||||
Land |
$ |
64,538 |
|
|
$ |
46,303 |
|
Building and improvements |
|
278,396 |
|
|
|
196,340 |
|
Tenant improvements |
|
5,431 |
|
|
|
4,428 |
|
Total real estate properties, at cost |
|
348,365 |
|
|
|
247,071 |
|
Less: Accumulated depreciation |
|
(20,884 |
) |
|
|
(13,215 |
) |
Total real estate properties, net |
|
327,481 |
|
|
|
233,856 |
|
Investment in financing leases, net |
|
16,213 |
|
|
|
515 |
|
Total real estate investments |
|
343,694 |
|
|
|
234,371 |
|
Cash |
|
5,857 |
|
|
|
2,212 |
|
Escrows and reserves |
|
1,169 |
|
|
|
1,059 |
|
Rent and other receivables |
|
4,172 |
|
|
|
3,521 |
|
Prepaid expenses and other assets, net |
|
7,511 |
|
|
|
4,434 |
|
Deferred rent receivable |
|
666 |
|
|
|
216 |
|
In-place lease intangibles, net |
|
14,399 |
|
|
|
13,022 |
|
Above market leases, net |
|
249 |
|
|
|
50 |
|
Total Assets |
$ |
377,717 |
|
|
$ |
258,885 |
|
|
|
|
|
||||
Liabilities and Equity |
|
|
|
||||
Liabilities: |
|
|
|
||||
Term loan, net |
$ |
49,359 |
|
|
$ |
— |
|
Revolving credit facility |
|
13,000 |
|
|
|
78,000 |
|
Secured borrowings, net |
|
32,990 |
|
|
|
46,629 |
|
Accounts payable, accrued expenses and other |
|
8,225 |
|
|
|
5,891 |
|
Below market leases, net |
|
8,670 |
|
|
|
8,726 |
|
Total Liabilities |
|
112,244 |
|
|
|
139,246 |
|
|
|
|
|
||||
Commitments and Contingencies |
|
|
|
||||
|
|
|
|
||||
Equity: |
|
|
|
||||
Class A common stock, par value $0.01 per share; 500,000,000 shares authorized, 18,564,421 and 9,437,197 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively |
|
186 |
|
|
|
95 |
|
Class B common stock, par value $0.01 per share; 27,206 shares authorized: 27,206 shares issued and outstanding as of December 31, 2021 and December 31, 2020 |
|
— |
|
|
|
— |
|
Additional paid-in capital |
|
237,969 |
|
|
|
100,812 |
|
Accumulated deficit |
|
(18,879 |
) |
|
|
(8,917 |
) |
Accumulated other comprehensive income |
|
766 |
|
|
|
— |
|
Total Stockholders’ Equity |
|
220,042 |
|
|
|
91,990 |
|
Operating Partnership unitholders’ non-controlling interests |
|
45,431 |
|
|
|
27,649 |
|
Total Equity |
|
265,473 |
|
|
|
119,639 |
|
Total Liabilities and Equity |
$ |
377,717 |
|
|
$ |
258,885 |
|
Postal Realty Trust, Inc.
|
||||||||
|
|
For the Three
|
|
For the Year
|
||||
Net income |
|
$ |
933 |
|
|
$ |
2,556 |
|
Depreciation and amortization |
|
|
3,859 |
|
|
|
13,990 |
|
FFO |
|
$ |
4,792 |
|
|
$ |
16,546 |
|
Recurring capital expenditures |
|
|
(409 |
) |
|
|
(861 |
) |
Write-off and amortization of deferred financing fees |
|
|
129 |
|
|
|
714 |
|
Loss on early extinguishment of debt |
|
|
— |
|
|
|
202 |
|
Straight-line rent and other adjustments |
|
|
(133 |
) |
|
|
(363 |
) |
Fair value lease adjustments |
|
|
(425 |
) |
|
|
(1,599 |
) |
Acquisition related expenses |
|
|
75 |
|
|
|
261 |
|
Income on insurance recoveries from casualties |
|
|
(125 |
) |
|
|
(401 |
) |
Non-cash components of compensation expense |
|
|
968 |
|
|
|
3,720 |
|
AFFO |
|
$ |
4,872 |
|
|
$ |
18,219 |
|
FFO per common share and common unit outstanding |
|
$ |
0.24 |
|
|
$ |
0.95 |
|
AFFO per common share and common unit outstanding |
|
$ |
0.25 |
|
|
$ |
1.05 |
|
Weighted average common shares and common units outstanding, basic and diluted |
|
|
19,868,315 |
|
|
|
17,369,967 |
|
