Four Corners Property Trust, Inc.

ladies and gentlemen hello and welcome to the fcpt third quarter 2022 financial results conference call my name is maxine and i'll be coordinating the call today if you would like to ask a question during the presentation you may do so by pressing star followed by one on your telephone keypad i will now hand you over to jerry morgan to begin jerry please go ahead when you're ready

Thank you. During the course of this call, we will make forward-looking statements, which are based on beliefs and assumptions made by us. Our actual results will be affected by known and unknown factors that are beyond our control or ability to predict. Our assumptions are not a guarantee of future performance, and some will prove to be incorrect. For more detailed description of some potential risks, please refer to our FCC filings, which can be found on our website at fcpt.com. All of the information presented on this call is current as of today, November 2nd. In addition, reconciliation to non-GAAP financial measures presented on this call, such as FFO and AFFO, can be found in the company's supplemental report, also on our website. And with that, I'll turn the call over to Bill.

Thank you, Jerry. Good morning. Thank you for joining us to discuss our third quarter results. I'm going to make introductory remarks. Patrick will review some details around acquisitions and the pipeline, and then Jerry will discuss the financial and capital results. The existing portfolio continued to perform exceptionally well with rental collections at 99.8% for the quarter and occupancy remaining at 99.9%. We reported third quarter AFFO of 41 cents per share, which represents a 5% increase year over year. We grew cash rental revenues 12.7% on a year over year basis, including the benefit of rental increases. and $236 million of acquisitions over the trailing 12 months. This included the acquisition of 26 properties in the third quarter for $70 million at an initial cash yield of 6.3%, reflecting rent credits at closing and near-term rent increases, or 6.2% on rents in place as of September 30. 23 of the 26 acquired properties are corporate operated, and we remain highly confident we are aligning our portfolio with best-in-class operators at attractive rent levels. 11 of the properties were mall outposts with strong operators, top brands, and 12 of these are ground leases, further evidencing the low rents in place. Patrick will soon discuss the investment environment in more detail, but we continue to see acquisition pricing improve in response to the higher cost of capital environment. This has been especially acute in the last month as the higher interest rate environment became more entrenched in sellers' expectations on cap rates. We are actively bidding on portfolios 50 to 100 basis points above where they would have priced a few months ago. We are already seeing momentum of this shift in pricing in our Q4 investments, but we note that in many circumstances, there is a delay between price agreement and closing. We have also, in selective cases, readdressed pricing on properties in our pipeline. Since inception, we have run this business sensitive to our cost of capital. and we've been careful to align incentives to this goal. For example, our acquisition team is not paid on acquisition volume. We have a team-based approach to acquisitions and we don't provide acquisition guidance. This has allowed us to keep a clear head when markets are in flux. In the quarter, we also sold four properties for a combined sales price of 8.6 million, representing a 5.5% weighted average cash capitalization rate. The strong demand for our portfolio properties provides us an alternative source of capital and validation of our portfolio quality. Moving on to our attendance performance, restaurant operators continue to have strong results in the most recent quarter, although many are expecting a downturn and focusing on keeping meals affordable, which has put pressure on pricing. Quick service restaurants are operating approximately 120% of weekly sales levels, and casual dining are operating approximately 103% of weekly sales levels, as compared to 2019, according to Bayer's most recent restaurant survey reported on October 24th. Our estimated EBITDA to rent coverage stood at four times for the 75% of our portfolio that reports this statistic. We believe that four times coverage is amongst the strongest within the net lease industry. This is when we reflect on the importance of rent setting and how that ultimately leads to stable landlord cash flows, even in challenging economic environments. These high levels of coverage provide a cushion for periods where inflation impacts store-level performance. Turning to the balance sheet, we raised $79 million of equity in the third quarter at an average price of $28.09 per share to support our investment program and delever. Additionally, the $8.6 million of dispositions helped fund our pipeline in the quarter at accretive rates. We've looked at dispositions more often and opportunistically in 2002, than in prior years. We would expect to continue utilizing dispositions as an alternative capital source to raising debt or equity in certain circumstances. Last week, we also announced the amendment to our credit facility, which reduced pricing and extended maturities by five years on $150 million of existing term loans and raised $30 million of additional proceeds. Thanks, Jerry. Our leverage remains conservative, and our debt maturities are fully staggered with the first maturity of $50 million not due until June of 2024. With that, I'll turn it over to Patrick.