First Capital, Inc.

Good afternoon. Thank you for standing by. Welcome to the Q4 2024 conference call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. At that time, if you have a question, please press star 1 on your telephone keypad. I would now like to turn the conference over to Allison. Please proceed with your presentation.

Thank you, and good afternoon. In discussing our financial and operating performance and in responding to your questions during today's call, we may make forward-looking statements. These statements are based on our current estimates and assumptions, many of which are beyond our control and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied in these statements. A summary of these underlying assumptions, risks, and uncertainties is contained in our securities filings including our MD&A for the year ended December 31, 2024, and our current AIF, which are available on CDAR Plus and our website. These forward-looking statements are made as of today's date, and except as required by the Curious Law, we undertake no obligation to publicly update or revise any such statements. During today's call, we will also be referencing certain non-IFRS financial measures. These do not have standardized meetings prescribed by IFRS and should not be construed as alternatives to net income or cash flow from operating activities determined in accordance with IFRS. Management provides these as a complement to IFRS measures to aid in assessing the rate's performance. These non-IFRS measures are further defined and discussed in our MD&A, which should be read in conjunction with this conference call. I'll now turn the call over to Adam.

Okay, thank you very much, Alison. Good afternoon, everyone. Thank you for joining us today for our year-end 2024 conference call. I'll start by bringing you back to our investor day, which we held in early 2024, and where we presented a three-year strategic plan. This plan was designed to be transformative for First Capital in several key respects. Most importantly, it contemplated a significant reshaping of our balance sheet. To achieve this, we would reduce the weighting and dollar amount of two key focus areas of our property portfolio. First, non-strategic, low-yielding properties. Second, properties with no income at all, which are assets held in our property development pipeline. and in both cases where we had achieved our value-enhancing objectives for the properties to be sold. These reductions were to largely be achieved through a $1 billion divestiture program over the course of the three-year plan. The redeployment of the proceeds from the divestiture program over the three-year timeframe were earmarked as roughly 40% towards overall debt reduction 40% to 50% to be invested in our development program, and the remaining 10% to 20% to be allocated opportunistically. Some examples in the opportunistic bucket included potential further debt reduction, compelling acquisitions such as our purchase last year of the remaining half of Seton Gateway, and depending on the cadence of dispositions and the price of FCR units, repurchases of trust units under our NCIB. As we presented the three-year plan for our investors in early 2024, we stressed the importance of FFO growth during the timeframe of our plan and over the long term. It is mission critical for our success. However, our portfolio and ultimately our balance sheet over weighting in low and no yield assets was impeding our ability to produce the FFO growth targets that we were aiming to achieve. With these changes to our portfolio and consequently our balance sheet over the three-year period, we would put First Capital in a much better position to deliver the primary objectives that we set out to achieve for our investors. To reiterate, these objectives were and are quite simply establishing a very solid earnings base in recurring FFO per unit, and delivering on a per unit basis consistent growth in FFO, consistent growth in net asset value, and absolutely stable, reliable monthly distributions to our investors with consistent growth in these distributions over time. As we executed the plan, we anticipated that we would deliver FFO growth of at least 3% per annum on average over the three-year period. This is a very respectable number and, importantly, powerful when combined with a simultaneous improvement of our balance sheet. I'll now go through the results for the first year of the plan. As I do, I will refer to OSFO or operating FFO. OFFO is funds from operations excluding the impact of items in other gains, losses, and expenses. You will have noted that with our 2024 results now reported as the first year of the three-year plan, our OFFO came in at $1.36 per unit. This represented a year-over-year growth rate of 14.9%. However, as I explained during last quarter's conference call, OFFO, as reported, included two unusual non-recurring items in both 2023 and 2024. Excluding these four items is more representative of what occurred in the underlying business. And by excluding these items, our OFFO growth rate in 2024 changes from 14.9% to 5.4%. The largest contributor to this OFFO growth by far with same property NOI growth. It increased by $17.7 million or 4.4% due to leasing activity throughout the year. The strong 2024 adjusted OFFO growth rate of 5.4% exceeded our target for the year. This puts FCR in a strong position to achieve our objective of an average of at least 3% per annum over the three-year plan period. Consistent SFO growth is a critical component for long-term success. We're off to a great start with our 2024 results. Another key focus of our three-year plan was to reduce our leverage ratio of debt to EBITDA to the low nines by the end of 2024 and the low eights by the end of 2026. In 2024, we were able to improve our debt to EBITDA by 120 basis points to 8.7 times at year end, nicely exceeding our first year target of a ratio in the low nines. The two unusual non-recurring items I flagged earlier in our 2024 OFFO also help our 2024 EBITDA and consequently our debt to EBITDA ratio. If we adjust the EBITDA to remove both, the adjusted leverage ratio changes to the low nines, which is very much in line with our objective for the year. Other benchmarks and targets that we discussed at our investor day included five additional metrics for the 2024 year that were embedded in our three-year plan. One related to dispositions, and we had an active year on that front. In 2024, we completed or went firm on 15 divestiture transactions, totaling approximately $320 million. They were consistent with our strategy. They collectively had an NOI yield of less than 3%, and notably, the assets were sold at an average premium to IFRS NAV of more than 50%. Earlier, I referred to the billion dollars of divestitures that we are targeting over the next three years, an average of approximately $333 million of dispositions per year. This is in line with the $320 million that we delivered in 2024. At our investor day, we said that we had actually hoped to deliver closer to $400 million in the first year of the three-year plan. Overall, we were very happy with the 2024 results that we did achieve, particularly the significant premium to net asset value. There were also four other 2024 metrics that we presented at our investor day that were embedded in our plan. These were same property NOI growth, development expenditures, portfolio capex, and G&A expenses. I can now report that we met or exceeded the 2024 target that we presented on all four. Overall, we were very pleased with our 2024 results. FFO growth was solid and above our internal forecast. In fact, the $1.26 per unit adjusted number was a new record that was last set in 2019. Debt EBITDA improved significantly, which meaningfully improved FCR's cost of debt capital. Same property NOI also came in better than planned. Lease renewal spreads were very healthy at 12.5%. Occupancy improved by 60 basis points to 96.8% at year end. It is now 10 basis points away from our all-time high set at the end of 2019, just before the start of the pandemic. and the average net rent in place of $24 set another all-time high. Given our results, significant balance sheet strength, and positive outlook, the Board approved a 3% increase to FCR's monthly distribution effective with the January 2025 distribution that is payable in February. As we've discussed, stability and growth in distributions is one of First Capital's key long-term objectives, so this increase represents an important milestone. However, we do not look at 2024 in isolation, but in the context of our three-year plan. As we start 2025, the second year of our plan, we are in a strong position to remain on track. And with that, I will now pass things over to Neil. Neil?