Americold Realty Trust, Inc.

Greetings, ladies and gentlemen, and welcome to AmeriCold Realty Trust's first quarter earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentations. Should anyone require operator assistance, please press star zero on the telephone keypad. It is now my pleasure to introduce your host, Mr. Scott Henderson. Thank you. You may begin.

Good afternoon. We would like to thank you for joining us today for AmeriCold Realty Trust's first quarter 2021 earnings conference call. In addition to the press release distributed this afternoon, we have filed a supplemental package with additional detail on our results, which is available in the investor section on our website at www.americal.com. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties, that may cause actual results to differ from those discussed today. A number of factors could cause actual results to differ materially from those anticipated. Forward-looking statements are based on current expectations, assumptions and beliefs, as well as information available to us at this time, and speak only of the date they are made, and management undertakes no obligation to update publicly any of them in light of new information or future events. During this call, we will discuss certain non-GAAP financial measures, including Core EBITDA, Core FFO, and AFFO. The full definitions of these non-GAAP financial measures and reconciliations to the comparable GAAP financial measures is contained in the supplemental information package available on the company's website. We also would like to note that numbers presented in today's prepared remarks have been rounded to the nearest million, with the exception of per share amounts. This afternoon's conference call is hosted by AmeriCorps' Chief Executive Officer, Fred Bowler, and Executive Vice President and Chief Financial Officer, Mark Smirnoff. Management will make some prepared comments, after which we will open up the call to your questions. Now, I will turn the call over to Fred.

Thank you, and welcome to our first quarter 2021 earnings conference call. We hope everyone on this call is well. This afternoon, I will summarize our first quarter 2021 results, our current view of market conditions, and our external growth activity. Mark will then review our quarterly results in more detail, as well as our recent capital markets activity and guidance for 2021. After our prepared remarks, we'll open the call for your questions. For the first quarter of 2021, global warehouse segment revenue was $485 million, which reflects growth of 27% year-over-year. Global warehouse segment NOI was $146 million, which reflects growth of 15%. For the first quarter 2021, our global warehouse same-store revenue decreased by 3.8% on a constant currency basis. Our global warehouse same-store NOI decreased by 6.9% on a constant currency basis. I'll note that if we normalize for the acquisitions that were added into our same store pool this quarter and the COVID surge from the first quarter of last year, our same store results would have been essentially flat on revenue and slightly positive on NOI. As discussed on the last earnings call, we fully anticipated continued supply chain disruption. As such, quarterly comps will be less relevant over the course of the year. We factored in supply chain variability, food service levels well below historic norms, elevated retail activity, food production at less than full capacity, and continued sanitation PPE costs. We are reaffirming our annual guidance for the year. Let me provide a bit more perspective. Entering into first quarter 2021, existing inventory and cold storage was below prior year's levels. While demand continues to remain steady, manufacturers have not yet gotten back up to full pre-COVID production levels. As such, their safety stock, which is represented by our physical inventory, is literally being eaten into. As the quarter progressed, conversations with our food manufacturing customers have indicated that production volumes are expected to increase and many of them are seeking to improve their inventory positions to better support their customers for the retailers and food service companies. We continue to be optimistic about global demand for all types of food production in our diverse portfolio, and we are confident that food manufacturers will return to pre-COVID inventory levels as end consumer demand remains firmly intact. Our commercial business processes, including our fixed commitment contracts, mitigate some but not all of this impact. While we continue to make progress, we would remind you that nearly all of our recent acquisitions over the past few years did not initially have a meaningful number of fixed commitment structures. Further, while almost all categories of food manufacturers' production lines have been impacted by COVID, certain subsets, such as protein, have been impacted more. As a reminder, Portfresh, Cloverleaf, Lanier, MHW, Novacold, and Newport are all part of our same store pool, but we're not in Q1 2020. These acquisitions are indexed greater towards protein. That said, we are actively working with our customers to bring these acquisitions onto our commercial standards. This is how we continue to enhance value for customers and shareholders. Finally, we are comparing to the first quarter 2020, where we saw buildup of inventory for export activity and, more importantly, the historic COVID-related surge. As a reminder, the first half of the year is typically lighter than the second half. However, we all remember the hurricane effect we experienced in the food supply chain when the global stay-at-home orders went into effect at the end of the first quarter 2020. This makes the year-over-year comparisons far less meaningful. The quarterly cadence of our results in 2020 was very unique, and as previously discussed, we expect it will continue to be so in 2021. Starting late in the first quarter of 2021, we have seen food manufacture activity start to ramp up, and our recent conversations with our customers have been very positive. As the vaccine continues to roll out and reopenings expand, We expect this will continue to help manufacturers with their staffing and processes, which should enable them to continue to ramp up production to more normalized levels in inventory positions. Further, individual states, regions, and countries are continuing to progress through the various stages of reopening, though we would note this has been very uneven. We expect this return to the norm to happen very gradually over 2021 and into 2022. Through it all, we continue to benefit from our portfolio's diversity and scale, the effectiveness of the AmeriCold operating system, and our commercial processes. Barriers to entry remain high in our business, and our integrated global platform, which now spans four continents, would be difficult, if not impossible, to replicate. Finally, we expect that food consumption will remain stable and in line with historical trends. For these reasons, we feel confident that our business will remain steady on an annual basis, which is reflected in our full year 2021 guidance targets. Now, let me turn to our external growth activity. We continue to execute on strategic development and acquisitions that will help us better serve our customers and their supply chain needs on a global scale. In specific, we completed two transactions since the start of the year, totaling $118 million and we have entered into a purchase agreement for an additional acquisition for $102 million expected to close this month. As we have said previously, strategic tuck-in acquisitions meaningfully enhance our existing network. Just as important, all of these transactions bring opportunity to drive NOI growth as we commercialize existing business and implement the AmeriCold operating system. On March 1st, we closed on the acquisition of Liberty Freezers in Canada for $46 million. Liberty consists of four assets totaling 10 million cubic feet, two owned facilities in Montreal and London, and two leased facilities in Toronto. This acquisition grows our exposure with several of our top 100 customers, as well as adds some new customers. And as a mix of protein, consumer packaged goods, bakery, and dairy, The Greater Toronto Area is one of Canada's most important distribution markets, and this transaction increases our existing footprint in Toronto by nearly 40%. Finally, this transaction includes approximately 20 buildable acres of land across the three cities to support additional development. On May 5th, we closed on the acquisition of KMT Burr in southern New Jersey for $71 million. KMT consists of two owned facilities totaling 13 million cubic feet, supporting the ports of Philadelphia and Wilmington. KMT also has a transportation business that provides less than truckload services to support its customers in the two warehouses. This acquisition increases our exposure to both new and current customers and is a mix of produce, protein, seafood, and bakery. This transaction grows our New Jersey footprint by 15% and complements our current portfolio in the region, which grew significantly through the agro and halls acquisitions. As we stated when we acquired agro, we continue to find opportunities to build our network in Europe. Subsequent to quarter end, we entered into a purchase agreement to acquire Bowman Stores, which operates a single campus located in Spalding, England, for $102 million. The campus aggregates 10 million cubic feet, along with four buildable acres of land to support additional development. Nearly all of the customers in this facility are new to AmeriCold, and the commodity mix is distributed between protein, prepared foods, and produce. The facility is also one of the few businesses in the UK with a protein export license to China. The asset is located approximately 100 miles north of London and complements our existing Whitchurch site. Please see pages 34 and 35 of our IR supplement for more detail on these three acquisitions. Finally, we continue to be very active on the ESG front. We recently posted our 2020 sustainability report to our corporate website. We encourage everyone listening to review it and learn about the progress on this important effort. As we noted in our report, we implemented 55 sustainability projects in 2020. In 2021, we look forward to pursuing additional sustainability projects, as well as increase our GCCA Energy Excellence Certifications. I'm very proud of the accomplishments across our organization with respect to ESG. In closing, it has been another busy quarter here at Ed Miracle. We continue to work to support our customers and their global supply chains through COVID-related disruptions as we look to return to normal. We thank our associates for their continued hard work and dedication. I'll now turn the call over to Mark, who will provide more details on our results, balance sheet, and outlook for 2021.