Americold Realty Trust Announces Fourth Quarter 2020 Results

ATLANTA–(BUSINESS WIRE)–Americold Realty Trust (NYSE: COLD) (the “Company”), the world’s largest publicly traded REIT focused on the ownership, operation, acquisition and development of temperature-controlled warehouses, today announced financial and operating results for the fourth quarter ended December 31, 2020.

Fred Boehler, President and Chief Executive Officer of Americold Realty Trust, stated, “Against the challenging backdrop of the COVID-19 pandemic, we are extremely proud of the consistency and the stability of our core business throughout 2020 and our ability to deliver results in line with our pre-COVID guidance. For the full year, we generated total company revenue growth and NOI growth of 11.4% and 15.3%, respectively, driven by our continued organic growth and acquisition activity. Within our global warehouse segment, we drove same store revenue and NOI growth of 2.3% and 5.6%, respectively, on a constant currency basis. We also delivered AFFO per share growth of 10.3%, while maintaining a low levered balance sheet. We attribute these strong results to our portfolio’s diversity and scale, as well as the effectiveness of the Americold Operating System and our commercialization efforts, which enabled us to overcome the supply chain disruption and financial impact of COVID-19.”

Mr. Boehler continued, “2020 was also a momentous year for external growth at Americold. In the fourth quarter, we completed the acquisitions of Agro Merchants Group, previously the fourth largest temperature controlled warehouse company globally, as well as New Jersey based Hall’s Warehouse Corporation. In total, we closed on $2.6 billion of acquisitions in 2020 and added 62 facilities totaling 342 million cubic feet to our global network. We entered key strategic markets in Europe and Canada through platform transactions and in Brazil through two joint ventures. We bolstered our presence in our legacy markets through deliberate and purposeful tuck-in acquisitions. At this point, our platform supports customers in 13 countries across four continents. We also grew our strategic development program, with seven projects totaling 62 million cubic feet under construction as of year end. We believe these projects materially enhance the value of our network at key logistics nodes. Finally, we executed on our stated ESG priorities, with over 95% of our facilities, excluding our 2020 acquisitions, receiving third-party gold or silver designations for energy excellence. Safety remains a top priority at Americold, and we had our sixth consecutive year with a reduction in our total recordable incident rate. We also continue to invest in training and advancement programs to further develop our employees.”

“As we look ahead to 2021 and beyond, we will continue to focus on driving internal growth, integrating our recent acquisitions and executing strategic growth initiatives. Above all, we will continue to support our customers as an integral part of the global food supply chain, and our success in doing so should result in lasting shareholder value creation.”

Fourth Quarter 2020 Highlights

Total revenue increased 7.8% to $523.7 million.
Total NOI increased 11% to $152.4 million.
Core EBITDA increased 7.5% on an actual basis, and 7.0% on a constant currency basis, to $117.2 million.
Net loss of $44.0 million, or $0.21 per diluted common share.
Core FFO of $81.9 million, or $0.39 per diluted common share.
AFFO of $76.9 million, or $0.37 per diluted common share.
Global Warehouse segment revenue increased 6.3% to $407.8 million.
Global Warehouse segment NOI increased 12% to $145.7 million.
Global Warehouse segment same store revenue decreased 0.5%, or 1.4% on a constant currency basis, same store segment NOI increased by 4.0%, or increased by 3.3% on a constant currency basis.
Completed the acquisitions of Hall’s for cash consideration of $481 million and Agro Merchants for total consideration of $1.7 billion.
Completed a public offering, including the green shoe, for net proceeds of approximately $1.35 billion. This funded growth initiatives, including the Agro and Hall’s acquisitions.
Closed an institutional private placement offering consisting of (i) €400 million senior unsecured notes with a coupon of 1.62% due January 7, 2031 (“Series D”) and (ii) €350 million senior unsecured notes with a coupon of 1.65% due January 7, 2033 (“Series E”).
Announced and broke ground on the expansion of our Russellville, Arkansas facility with an expected cost of $84 million to create a highly-automated build for one of our top tier customers, Conagra, with expected completion by the fourth quarter of 2022.
Announced and broke ground on the expansion of our Calgary, Canada facility with an expected cost of C$15 million for a conventional, multi-tenant use, with expected completion by the fourth quarter of 2021.
Ended the year with 161 facilities certified either Gold or Silver by the Global Cold Chain Alliance as part of its Energy Excellence Recognition Program, with over 95% of legacy Global Warehouse segment portfolio (which excludes all 2020 acquisitions) being certified by this program.

Full Year 2020 Highlights

Total revenue increased 11.4% to $1.99 billion.
Total NOI increased 15.3% to $551.5 million.
Core EBITDA increased 16.0% to $425.9 million, or 16.3% on a constant currency basis.
Net income of $24.6 million, or $0.11 per diluted common share.
Core FFO of $255.7 million, or $1.24 per diluted common share.
AFFO of $267.9 million, or $1.29 per diluted common share.
Global Warehouse segment revenue increased 12.5% to $1.55 billion.
Global Warehouse segment NOI increased 16.3% to $520.3 million.
Global Warehouse segment same store revenue increased 1.9%, or 2.3% on a constant currency basis, same store segment NOI increased 5.3%, or 5.6% on a constant currency basis.
Completed $2.6 billion of acquisitions, including Nova Cold Logistics, Newport Cold, AM-C Warehouses, Caspers Cold Storage, Halls Warehouse Corporation, and Agro Merchants Group and acquired a 15% interest in SuperFrio for Brazil Reals of 118 million.
Announced and broke ground on five development and expansion projects with an expected total cost of $461 million.

Subsequent Event Highlights

On January 29, 2021, closed on an amendment to our existing unsecured credit facility, which increased the multicurrency line of credit from $800 million to $1 billion, and concurrently paid down Senior Unsecured Term Loan A Facility Tranche A-1 from $325 million to $125 million using cash on the balance sheet.

Fourth Quarter 2020 Total Company Financial Results

Total revenue for the fourth quarter of 2020 was $523.7 million, a 7.8% increase from the same quarter of the prior year. This growth was primarily driven by the incremental revenue from acquisitions, recently completed development projects and revenue in our Managed segment driven by higher pass through of costs due to elevated retail volumes.

For the fourth quarter of 2020, the Company reported a net loss of $44.0 million, or $0.21 per diluted share, compared to net income of $20.8 million, or $0.10 per diluted share, for the same quarter of the prior year.

Total NOI for the fourth quarter of 2020 was $152.4 million, an increase of 11% from the same quarter of the prior year.

Core EBITDA was $117.2 million for the fourth quarter of 2020, compared to $109.1 million for the same quarter of the prior year. This reflects an 7.5% increase over prior year on an actual basis, and 7.0% on a constant currency basis, driven primarily from acquisition contribution, recently completed development projects, and organic growth in our core business. These increases were partially offset by the incremental costs incurred in response to COVID-19 and higher SG&A.

For the fourth quarter of 2020, Core FFO was $81.9 million, or $0.39 per diluted share, compared to $64.6 million, or $0.33 per diluted share, for same quarter of the prior year.

For the fourth quarter of 2020, AFFO was $76.9 million, or $0.37 per diluted share, compared to $59.7 million, or $0.30 per diluted share, for the same quarter of the prior year.

Please see the Company’s supplemental financial information for the definitions and reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures.

Fourth Quarter 2020 Global Warehouse Segment Results

For the fourth quarter of 2020, Global Warehouse segment revenue was $407.8 million, an increase of $24.0 million, or 6%, compared to $383.8 million for the fourth quarter of 2019. This growth was driven by the recently completed acquisitions and development projects, paired with contractual rate escalations, partially offset by lower throughput associated with the protein and food service sectors.

Warehouse segment NOI was $145.7 million for the fourth quarter of 2020, an increase of 12%. Global Warehouse segment margin was 35.7% for the fourth quarter of 2020, an 196 basis point increase compared to the same quarter of the prior year. The year-over-year growth in segment NOI was driven by the previously mentioned revenue trends. The Company continues to incur incremental expenses to address the risks and challenges of COVID-19. These incremental COVID-19 expenses primarily include higher sanitation costs of $1.0 million while personal protective equipment (“PPE”) costs were nominal. The Company has experienced certain inefficiencies due to social distancing, staggered schedules, and other changes to processes, all of which it expects to incur going forward. The Company expects to recover these costs through ongoing revenue as it signs new business and renews existing business. The Company’s results include the impact of these items. Additionally, the growth reflected favorable comparisons to costs incurred in the prior year, including both health insurance and Rochelle startup related costs, both incurred in the prior comparable period.

We had 135 same stores for the years ended December 31, 2020 and 2019. The following table presents revenues, cost of operations, contribution (NOI) and margins for our same stores and non-same stores with a reconciliation to the total financial metrics of our warehouse segment for the three and twelve months ended December 31, 2020 and December 31, 2019. Amounts related to the AM-C, Cloverleaf, Caspers, Hall’s, Lanier, MHW, Newport and Nova Cold acquisitions are reflected within non-same store results. The operational results from one day of ownership from the Agro acquisition is not material for the year ended December 31, 2020.

	Three Months Ended December 31,									Change
Dollars in thousands	2020 actual			2020 constant currency⁽¹⁾			2019 actual			Actual		Constant currency

TOTAL WAREHOUSE SEGMENT
Number of total warehouses⁽²⁾	229						167			n/a		n/a
Global Warehouse revenue:
Rent and storage	$	173,822		$	173,135		$	158,105		9.9	%	9.5	%
Warehouse services	233,989			231,590			225,673			3.7	%	2.6	%
Total revenue	$	407,811		$	404,725		$	383,778		6.3	%	5.5	%
Global Warehouse contribution (NOI)	$	145,672		$	144,932		$	129,547		12.4	%	11.9	%
Global Warehouse margin	35.7		%	35.8		%	33.8		%	196 bps		205 bps
Units in thousands except per pallet data
Global Warehouse rent and storage metrics:
Average economic occupied pallets	3,368			n/a			3,185			5.7	%	n/a
Average physical occupied pallets	3,075			n/a			3,045			1.0	%	n/a
Average physical pallet positions	4,252			n/a			3,833			10.9	%	n/a
Economic occupancy percentage	79.2		%	n/a			83.1		%	-389 bps		n/a
Physical occupancy percentage	72.3		%	n/a			79.5		%	-713 bps		n/a
Total rent and storage revenue per economic occupied pallet	$	51.61		$	51.41		$	49.64		4.0	%	3.6	%
Total rent and storage revenue per physical occupied pallet	$	56.52		$	56.30		$	51.92		8.9	%	8.4	%
Global Warehouse services metrics:
Throughput pallets	8,290			n/a			8,229			0.7	%	n/a
Total warehouse services revenue per throughput pallet	$	28.23		$	27.94		$	27.43		2.9	%	1.9	%

SAME STORE WAREHOUSE
Number of same store warehouses	135						135			n/a		n/a
Global Warehouse same store revenue:
Rent and storage	$	129,459		$	128,861		$	128,722		0.6	%	0.1	%
Warehouse services	172,933			170,580			175,107			(1.2	)%	(2.6	)%
Total same store revenue	$	302,392		$	299,441		$	303,829		(0.5	)%	(1.4	)%
Global Warehouse same store contribution (NOI)	$	111,067		$	110,357		$	106,819		4.0	%	3.3	%
Global Warehouse same store margin	36.7		%	36.9		%	35.2		%	157 bps		170 bps
Units in thousands except per pallet data
Global Warehouse same store rent and storage metrics:
Average economic occupied pallets	2,511			n/a			2,556			(1.8	)%	n/a
Average physical occupied pallets	2,246			n/a			2,433			(7.7	)%	n/a
Average physical pallet positions	3,037			n/a			3,030			0.2	%	n/a
Economic occupancy percentage	82.7		%	n/a			84.3		%	-166 bps		n/a
Physical occupancy percentage	73.9		%	n/a			80.3		%	-634 bps		n/a
Same store rent and storage revenue per economic occupied pallet	$	51.55		$	51.31		$	50.37		2.3	%	1.9	%
Same store rent and storage revenue per physical occupied pallet	$	57.65		$	57.38		$	52.92		8.9	%	8.4	%
Global Warehouse same store services metrics:
Throughput pallets	6,243			n/a			6,672			(6.4	)%	n/a
Same store warehouse services revenue per throughput pallet	$	27.70		$	27.32		$	26.25		5.5	%	4.1	%

	Three Months Ended December 31,									Change
Dollars in thousands	2020 actual			2020 constant currency⁽¹⁾			2019 actual			Actual		Constant currency

NON-SAME STORE WAREHOUSE
Number of non-same store warehouses⁽³⁾	94						32			n/a		n/a
Global Warehouse non-same store revenue:
Rent and storage	$	44,363		$	44,274		$	29,383		51.0	%	50.7	%
Warehouse services	61,056			61,010			50,566			20.7	%	20.7	%
Total non-same store revenue	$	105,419		$	105,284		$	79,949		31.9	%	31.7	%
Global Warehouse non-same store contribution (NOI)	$	34,605		$	34,575		$	22,728		52.3	%	52.1	%
Global Warehouse non-same store margin	32.8		%	32.8		%	28.4		%	440 bps		441 bps
Units in thousands except per pallet data
Global Warehouse non-same store rent and storage metrics:
Average economic occupied pallets	856			n/a			629			36.1	%	n/a
Average physical occupied pallets	829			n/a			613			35.4	%	n/a
Average physical pallet positions	1,214			n/a			803			51.2	%	n/a
Economic occupancy percentage	70.5		%	n/a			78.4		%	-788 bps		n/a
Physical occupancy percentage	68.3		%	n/a			76.3		%	-805 bps		n/a
Non-same store rent and storage revenue per economic occupied pallet	$	51.80		$	51.70		$	46.69		10.9	%	10.7	%
Non-same store rent and storage revenue per physical occupied pallet	$	53.49		$	53.38		$	47.95		11.6	%	11.3	%
Global Warehouse non-same store services metrics:
Throughput pallets	2,047			n/a			1,557			31.5	%	n/a
Non-same store warehouse services revenue per throughput pallet	$	29.83		$	29.81		$	32.48		(8.2	)%	(8.2	)%

	Year Ended December 31,									Change
Dollars in thousands	2020 actual			2020 constant currency⁽¹⁾			2019 actual			Actual		Constant currency

TOTAL WAREHOUSE SEGMENT
Number of total warehouses⁽²⁾	229						167			n/a		n/a
Global Warehouse revenue:
Rent and storage	$	666,150		$	669,154		$	582,509		14.4	%	14.9	%
Warehouse services	883,164			885,728			794,708			11.1	%	11.5	%
Total revenue	$	1,549,314		$	1,554,882		$	1,377,217		12.5	%	12.9	%
Global Warehouse contribution (NOI)	$	520,333		$	521,883		$	447,591		16.3	%	16.6	%
Global Warehouse margin	33.6		%	33.6		%	32.5		%	109 bps		106 bps
Units in thousands except per pallet data
Global Warehouse rent and storage metrics:
Average economic occupied pallets	3,233			n/a			2,865			12.8	%	n/a
Average physical occupied pallets	2,966			n/a			2,728			8.7	%	n/a
Average physical pallet positions	4,095			n/a			3,604			13.6	%	n/a
Economic occupancy percentage	79.0		%	n/a			79.5		%	-55 bps		n/a
Physical occupancy percentage	72.4		%	n/a			75.7		%	-327 bps		n/a
Total rent and storage revenue per economic occupied pallet	$	206.03		$	206.96		$	203.31		1.3	%	1.8	%
Total rent and storage revenue per physical occupied pallet	$	224.60		$	225.61		$	213.52		5.2	%	5.7	%
Global Warehouse services metrics:
Throughput pallets	32,124			n/a			30,090			6.8	%	n/a
Total warehouse services revenue per throughput pallet	$	27.49		$	27.57		$	26.41		4.1	%	4.4	%

SAME STORE WAREHOUSE
Number of same store warehouses	135						135			n/a		n/a
Global Warehouse same store revenue:
Rent and storage	$	507,848		$	510,614		$	494,273		2.7	%	3.3	%
Warehouse services	668,717			671,079			660,843			1.2	%	1.5	%
Total same store revenue	$	1,176,565		$	1,181,693		$	1,155,116		1.9	%	2.3	%
Global Warehouse same store contribution (NOI)	$	401,287		$	402,643		$	381,209		5.3	%	5.6	%
Global Warehouse same store margin	34.1		%	34.1		%	33.0		%	110 bps		107 bps
Units in thousands except per pallet data
Global Warehouse same store rent and storage metrics:
Average economic occupied pallets	2,440			n/a			2,405			1.5	%	n/a
Average physical occupied pallets	2,204			n/a			2,282			(3.4	)%	n/a
Average physical pallet positions	3,031			n/a			3,028			0.1	%	n/a
Economic occupancy percentage	80.5		%	n/a			79.4		%	110 bps		n/a
Physical occupancy percentage	72.7		%	n/a			75.4		%	-265 bps		n/a
Same store rent and storage revenue per economic occupied pallet	$	208.10		$	209.23		$	205.53		1.3	%	1.8	%
Same store rent and storage revenue per physical occupied pallet	$	230.45		$	231.70		$	216.62		6.4	%	7.0	%
Global Warehouse same store services metrics:
Throughput pallets	25,133			n/a			25,842			(2.7	)%	n/a
Same store warehouse services revenue per throughput pallet	$	26.61		$	26.70		$	25.57		4.1	%	4.4	%

	Year Ended December 31,									Change
Dollars in thousands	2020 actual			2020 constant currency⁽¹⁾			2019 actual			Actual		Constant currency

NON-SAME STORE WAREHOUSE
Number of non-same store warehouses⁽³⁾	94						32			n/a		n/a
Global Warehouse non-same store revenue:
Rent and storage	$	158,302		$	158,540		$	88,236		79.4	%	79.7	%
Warehouse services	214,447			214,649			133,865			60.2	%	60.3	%
Total non-same store revenue	$	372,749		$	373,189		$	222,101		67.8	%	68.0	%
Global Warehouse non-same store contribution (NOI)	$	119,046		$	119,240		$	66,382		79.3	%	79.6	%
Global Warehouse non-same store margin	31.9		%	32.0		%	29.9		%	205 bps		206 bps
Units in thousands except per pallet data
Global Warehouse non-same store rent and storage metrics:
Average economic occupied pallets	793			n/a			460			72.2	%	n/a
Average physical occupied pallets	762			n/a			446			70.8	%	n/a
Average physical pallet positions	1,065			n/a			576			84.8	%	n/a
Economic occupancy percentage	74.5		%	n/a			79.9		%	-542 bps		n/a
Physical occupancy percentage	71.6		%	n/a			77.5		%	-586 bps		n/a
Non-same store rent and storage revenue per economic occupied pallet	$	199.67		$	199.97		$	191.67		4.2	%	4.3	%
Non-same store rent and storage revenue per physical occupied pallet	$	207.69		$	208.00		$	197.71		5.0	%	5.2	%
Global Warehouse non-same store services metrics:
Throughput pallets	6,990			n/a			4,249			64.5	%	n/a
Non-same store warehouse services revenue per throughput pallet	$	30.68		$	30.71		$	31.51		(2.6	)%	(2.5	)%

(1) The adjustments from our U.S. GAAP operating results to calculate our operating results on a constant currency basis are the effect of changes in foreign currency exchange rates relative to the comparable prior period.

(2) Total warehouse count of 229 includes 46 warehouses acquired through the Agro acquisition on December 30, 2020, eight warehouses acquired through the Hall’s acquisition on November 2, 2020, three warehouses acquired through the Casper’s and AM-C warehouse acquisitions on August 31, 2020, and five warehouses acquired through the Nova Cold and Newport acquisitions on January 2, 2020. The results of these acquisitions are reflected in the results above since date of ownership. The operational results from one day of ownership of the Agro warehouses is immaterial to the three months and year ended December 31, 2020.

(3) Non-same store warehouse count of 94 includes 46 warehouses acquired through the Agro acquisition on December 30, 2020, eight warehouses acquired through the Hall’s acquisition on November 2, 2020, three warehouses acquired through the Casper’s and AM-C warehouse acquisitions on August 31, 2020, and five warehouses acquired through the Nova Cold and Newport acquisitions on January 2, 2020. The results of these acquisitions are reflected in the results above since date of ownership. The operational results from one day of ownership of the Agro warehouses is immaterial to the three months and year ended December 31, 2020.

(n/a = not applicable)

Fixed Commitment Rent and Storage Revenue

As of December 31, 2020, $283.6 million of the Company’s annualized rent and storage revenue were derived from customers with fixed commitment storage contracts. This compares to $279.7 million at the end of the third quarter of 2020 and $251.1 million at the end of the fourth quarter of 2019. The Company’s recent acquisitions had a lower percentage of fixed committed contracts as a percentage of rent and storage revenue. On a combined pro forma basis, assuming a full twelve months of acquisitions revenue, 40.7% of rent and storage revenue were generated from fixed commitment storage contracts, which is a 140 basis point decrease over the third quarter of 2020. The Agro acquisition is excluded from the fixed commitment rent and storage revenue metrics.

Economic and Physical Occupancy

Contracts that contain fixed commitments are designed to ensure the Company’s customers have space available when needed. For the fourth quarter of 2020, economic occupancy for the total warehouse segment was 79.2% and warehouse segment same store pool was 82.7%, representing a 688 basis point and 874 basis point increase above physical occupancy, respectively. For the fourth quarter of 2020, physical occupancy for the total warehouse segment was 72.3% and warehouse segment same store pool was 73.9%.

Real Estate Portfolio

As of December 31, 2020, the Company’s portfolio consists of 238 facilities. The Company ended the fourth quarter of 2020 with 229 facilities in its Global Warehouse segment portfolio and nine facilities in its Third-party managed segment. During the fourth quarter of 2020, the Company added eight facilities through the acquisition of Hall’s and 46 facilities in connection with the Agro acquisition. Additionally, the Company exited the operations of one Third-party managed facility in Canada. The same store population consists of 135 facilities for the quarter ended December 31, 2020. The remaining 94 non-same store population includes the 88 facilities that were acquired since the beginning of 2019 and six legacy facilities.

Balance Sheet Activity and Liquidity

As of December 31, 2020, the Company had total liquidity of approximately $1.7 billion, including cash and capacity on its revolving credit facility and $392 million of net proceeds available from equity forward contracts. Total debt outstanding was $3.0 billion (inclusive of $311.0 million of financing leases/sale lease-backs and exclusive of unamortized deferred financing fees), of which 80% was in an unsecured structure. The Company has no material debt maturities until 2023.

Contacts

Americold Realty Trust

Investor Relations

Telephone: 678-459-1959

Email: investor.relations@americold.com

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