Americold Announces Third Quarter 2024 Results

Record Services Margins for a Third Consecutive Quarter

Announces $148 Million automation Development in Dallas-Fort Worth

ATLANTA, GA., Nov. 07, 2024 (GLOBE NEWSWIRE) -- Americold Realty Trust, Inc. (NYSE: COLD) (the“Company”), a global leader in temperature-controlled logistics, real estate, and value-added services focused on the ownership, operation, Acquisition and development of temperature-controlled warehouses, today announced financial and operating results for the third quarter ended September 30, 2024.

George Chappelle, Chief Executive Officer of Americold Realty Trust, stated,“We are pleased with our third quarter results where we delivered AFFO per share of $0.35, an increase of 11% versus prior year's quarter. This performance was again driven by organic growth as we produced double digit year-over-year growth in the Global Warehouse Same Store NOI of approximately 11% on a constant currency basis. We continue to demonstrate our ability to generate meaningful returns to our shareholders in any environment as our Same Store Warehouse Services Margins increased to 14.5%, an 11 percentage point improvement from the previous year's quarter on a constant currency basis.

The resiliency in our approach over the past three years to stabilize our workforce and the investments we have made in our technology and processes have built a solid foundation and positions us well for the future. We remain steadfast in our pursuit to invest in our future as we continue to evaluate development opportunities across our three primary areas of focus: expansion projects; customer-dedicated, build-to-suit developments; and our CPKC and DP World collaborations. During the quarter we successfully raised $500 million in our inaugural public bond offering, which gives us another avenue of capital to help grow our portfolio and provide predictable and sustainable returns for all of our stakeholders.

Lastly, I am pleased to announce a new $148 million dollar automation development in Dallas-Fort Worth that would now have us exceed the higher end of development guidance and will further demonstrate our industry-leading automation design capabilities.”

Third Quarter 2024 Highlights

• Total revenue of $674.2 million, a 0.9% change from $667.9 million in Q3 2023 and a change of 2.1% on a constant currency basis.
• Net loss of $3.7 million, or $0.01 loss per diluted common share.
• Total Company NOI increased 10.6% to $209.2 million from $189.1 million in Q3 2023 and a 12.0% increase on a constant currency basis.
• Total Company NOI margin increased 272 bps to 31.0% from 28.3% in Q3 2023.
• Global Warehouse same store services margin increased to 14.5% from 3.5% in Q3 2023.
• Core FFO of $83.9 million, or $0.29 per diluted common share, a 17.7% change from Q3 2023 Core FFO per diluted common share.
• AFFO of $100.1 million, or $0.35 per diluted common share, a 10.9% change from Q3 2023 AFFO per diluted common share.
• Core EBITDA of $157.2 million, increased $13.2 million, or 9.1% from $144.0 million in Q3 2023.
• Core EBITDA margin of 23.3%, increased 176 basis points from 21.6% in Q3 2023.
• Global Warehouse segment same store revenue increased 1.9% on an actual basis and increased 3.0% on a constant currency basis as compared to Q3 2023.
• Global Warehouse segment same store NOI increased 9.5%, or 10.9% on a constant currency basis as compared to Q3 2023 .
• Completed public debt offering of $500 million at an interest rate of 5.409% to be paid semi-annually, with a debt maturity of September 12, 2034.

2024 Outlook

The table below includes the details of our annual guidance. The Company's guidance is provided for informational purposes based on current plans and assumptions and is subject to change. The ranges for these metrics do not include the impact of acquisitions, dispositions, or capital markets activity beyond that which has been previously announced.

(1) Represents the aggregate invested capital for initiated development opportunities.

Investor Webcast and Conference Call
The Company will hold a webcast and conference call on Thursday, November 7, 2024 at 8:00 a.m. Eastern Time to discuss its third quarter 2024 results. A live webcast of the call will be available via the Investors section of Americold Realty Trust's website at . To listen to the live webcast, please go to the site at least fifteen minutes prior to the scheduled start time in order to register, download and install any necessary audio software. Shortly after the call, a replay of the webcast will be available for 90 days on the Company's website.

The conference call can also be accessed by dialing 1-877-407-3982 or 1-201-493-6780. The telephone replay can be accessed by dialing 1-844-512-2921 or 1-412-317-6671 and providing the conference ID#13743084. The telephone replay will be available starting shortly after the call until November 21, 2024.

The Company's supplemental package will be available prior to the conference call in the Investors section of the Company's website at .

During the conference call, the Company may discuss and answer questions concerning business and financial developments and trends that have occurred after quarter-end. The Company's responses to questions, as well as other matters discussed during the conference call, may contain or constitute information that has not been disclosed previously.

Third Quarter 2024 Total Company Financial Results

Total revenue for the third quarter of 2024 was $674.2 million, a 0.9% increase from the $667.9 million from the same quarter of the prior year, which was the result of growth within our Global Warehouse segment, partially offset by changes in our Transportation segment. The growth within our Global Warehouse segment was driven by an increase in fixed commitment contracts, pricing initiatives and rate escalations, partially offset by lower economic occupancy and throughput.

Total NOI for the third quarter of 2024 was $209.2 million, an increase of 10.6% from the same quarter of the prior year. This increase is a result of productivity improvements driving higher warehouse services margins, in addition to the drivers of revenue growth mentioned above.

For the third quarter of 2024, the Company reported a net loss of $3.7 million, or $0.01 loss per diluted share, compared to a net loss of $2.1 million, or $0.01 loss per diluted share, for the comparable quarter of the prior year.

Core EBITDA was $157.2 million for the third quarter of 2024, compared to $144.0 million for the comparable quarter of the prior year. This reflects a 9.1% increase over prior year on an actual basis, and 10.2% on a constant currency basis. The increase is due to the same factors driving the increase in NOI mentioned above.

For the third quarter of 2024, Core FFO was $83.9 million, or $0.29 per diluted share, compared to $69.6 million, or $0.25 per diluted share, for the third quarter of 2023.

For the third quarter of 2024, AFFO was $100.1 million, or $0.35 per diluted share, compared to $88.2 million, or $0.32 per diluted share, for the third quarter of 2023.

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.

Third Quarter 2024 Global Warehouse Segment Results

The following table presents revenues, contribution (NOI) and margins for our same store and non-same store warehouses with a reconciliation to the total financial metrics of our warehouse segment for the three and nine months ended September 30, 2024. Refer to our“Real Estate Portfolio” section below for the composition of our non-same store pool.

(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) Refer to our“Real Estate Portfolio” section below for the composition of our non-same store pool.
(n/a = not applicable)
(n/r = not relevant)

(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) Refer to our“Real Estate Portfolio” section below for the composition of our non-same store pool.
(n/a = not applicable)
(n/r = not relevant)

For the third quarter of 2024, Global Warehouse segment revenue was $612.2 million, an increase of $9.6 million, or 1.6% (2.7% on a constant currency basis), compared to $602.6 million for the third quarter of 2023. This growth was principally driven by our pricing initiatives and rate escalations. This was partially offset by lower occupancy and throughput pallets due to consumer buying habits.

Global Warehouse segment contribution (NOI) was $198.6 million for the third quarter of 2024 as compared to $177.8 million for the third quarter of 2023, an increase of $20.8 million or 11.7% (13.0% on a constant currency basis). Global Warehouse segment contribution (NOI) increased due to higher revenue, strong variable cost controls and labor efficiencies. Global Warehouse segment margin was 32.4% for the third quarter of 2024, a 293 basis point increase as to compared to the third quarter of 2023, driven by improvement in our warehouse services margin due to the factors noted above.

Fixed Commitment Rent and Storage Revenue

As of September 30, 2024, $623.8 million of the Company's annualized rent and storage revenues were derived from customers with fixed commitment storage contracts. This compares to $618.0 million at the end of the second quarter of 2024 and $550.7 million at the end of the third quarter of 2023. We continue to make progress on commercializing business under this type of arrangement. On a combined basis, 58.1% of rent and storage revenue was generated from fixed commitment storage contracts.

Economic and Physical Occupancy

Contracts that contain fixed commitments are designed to ensure the Company's customers have space available when needed. For the third quarter of 2024, economic occupancy for the total warehouse segment was 76.7% and warehouse segment same store pool was 78.0%, representing a 1,005 basis point and 1,021 basis point increase above physical occupancy, respectively. Economic occupancy for the total warehouse segment decreased 633 basis points, and the warehouse segment same store pool decreased 590 basis points as compared to the third quarter of 2023 due to continued weaker consumer demand.

Real Estate Portfolio

As of September 30, 2024, the Company's portfolio consists of 239 facilities. The Company ended the third quarter of 2024 with 235 facilities in its Global Warehouse segment portfolio and 4 facilities in its Third-party managed segment. The same store population consists of 226 facilities for the quarter ended September 30, 2024. The non-same store facility count consists of: 5 sites in the expansion and development phase, 2 facilities that we purchased in 2023, 2 facilities whose operations have ceased and the Company is evaluating alternative use including, third party lease and or sale.

Balance Sheet Activity and Liquidity

As of September 30, 2024, the Company had total liquidity of approximately $921.9 million, including cash and capacity on its revolving credit facility. Total net debt outstanding was $3.5 billion (inclusive of $169.2 million of financing leases/sale lease-backs and exclusive of unamortized deferred financing fees), of which 95% was in an unsecured structure. At quarter end, net debt to Core EBITDA (based on trailing twelve months Core EBITDA) was approximately 5.5x. The Company's real estate debt has a remaining weighted average term of 5.4 years and carries a weighted average contractual interest rate of 3.9%. As of September 30, 2024, 92% of the Company's total debt outstanding was at a fixed rate, inclusive of hedged variable-rate for fixed-rate debt. The Company has no material debt maturities until 2026, inclusive of extension options.

Dividend

On September 3, 2024, the Company's Board of Directors declared a dividend of $0.22 per share for the third quarter of 2024, which was paid on October 15, 2024 to common stockholders of record as of September 30, 2024.

About the Company

Americold is a global leader in temperature-controlled logistics real estate and value added services. Focused on the ownership, operation, acquisition and development of temperature-controlled warehouses, Americold owns and/or operates 239 temperature-controlled warehouses, with approximately 1.4 billion refrigerated cubic feet of storage, in North America, Europe, Asia-Pacific, and South America. Americold's facilities are an integral component of the supply chain connecting food producers, processors, distributors and retailers to consumers.

Non-GAAP Measures

This press release contains non-GAAP financial measures, including NAREIT FFO, Core FFO, Adjusted FFO, NAREIT EBITDAre, Core EBITDA, Core EBITDA margin, same store segment revenue, contribution (NOI) and margin, and maintenance capital expenditures. Definitions of these non-GAAP metrics are included in our quarterly financial supplement, and reconciliations of these non-GAAP measures to their most comparable GAAP metrics are included herein. Each of the non-GAAP measures included in this press release has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of the Company's results calculated in accordance with GAAP. In addition, because not all companies use identical calculations, the Company's presentation of non-GAAP measures in this press release may not be comparable to similarly titled measures disclosed by other companies, including other REITs.

Forward-Looking Statements

This press release contains statements about future events and expectations that constitute forward-looking statements. Forward-looking statements are based on our beliefs, assumptions and expectations of our future financial and operating performance and growth plans, taking into account the information currently available to us. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements, and you should not place undue reliance on such statements. Factors that could contribute to these differences include the following: rising inflationary pressures, increased interest rates and operating costs; labor and power costs; labor shortages; our relationship with our associates, the occurrence of any work stoppages or any disputes under our collective bargaining agreements and employment related litigation; the impact of supply chain disruptions; risks related to rising construction costs; risks related to expansions of existing properties and developments of new properties, including failure to meet budgeted or stabilized returns within expected time frames, or at all, in respect thereof; uncertainty of revenues, given the nature of our customer contracts; acquisition risks, including the failure to identify or complete attractive acquisitions or failure to realize the intended benefits from our recent acquisitions; difficulties in expanding our operations into new markets; uncertainties and risks related to public health crises; a failure of our information technology systems, systems conversions and integrations, cybersecurity attacks or a breach of our information security systems, networks or processes; risks related to implementation of the new ERP system, defaults or non-renewals of significant customer contracts; risks related to privacy and data security concerns, and data collection and transfer restrictions and related foreign regulations; changes in applicable governmental regulations and tax legislation; risks related to current and potential international operations and properties; actions by our competitors and their increasing ability to compete with us; changes in foreign currency exchange rates; the potential liabilities, costs and regulatory impacts associated with our in-house trucking services and the potential disruptions associated with our use of third-party trucking service providers to provide transportation services to our customers; liabilities as a result of our participation in multi-employer pension plans; risks related to the partial ownership of properties, including our JV investments; risks related to natural disasters; adverse economic or real estate developments in our geographic markets or the temperature-controlled warehouse industry; changes in real estate and zoning laws and increases in real property tax rates; general economic conditions; risks associated with the ownership of real estate generally and temperature-controlled warehouses in particular; possible environmental liabilities; uninsured losses or losses in excess of our insurance coverage; financial market fluctuations; our failure to obtain necessary outside financing on attractive terms, or at all; risks related to, or restrictions contained in, our debt financings; decreased storage rates or increased vacancy rates; the potential dilutive effect of our common stock offerings, including our ongoing at the market program; the cost and time requirements as a result of our operation as a publicly traded REIT; and our failure to maintain our status as a REIT.

Words such as“anticipates,”“believes,”“continues,”“estimates,”“expects,”“goal,”“objectives,”“intends,”“may,”“opportunity,”“plans,”“potential,”“near-term,”“long-term,”“projections,”“assumptions,”“projects,”“guidance,”“forecasts,”“outlook,”“target,”“trends,”“should,”“could,”“would,”“will” and similar expressions are intended to identify such forward-looking statements, although not all forward-looking statements may contain such words. Examples of forward-looking statements included in this press release include those regarding our 2024 outlook and our migration of our customers to fixed commitment storage contracts. We qualify any forward-looking statements entirely by these cautionary factors. Other risks, uncertainties and factors, including those discussed under“Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, and other reports filed with the Securities and Exchange Commission, could cause our actual results to differ materially from those projected in any forward-looking statements we make. We assume no obligation to update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future except to the extent required by law.

Contacts:

Americold Realty Trust, Inc.
Investor Relations
Telephone: 678-459-1959
Email: ...

(a) Maintenance capital expenditures include capital expenditures made to extend the life of, and provide future economic benefit from, our existing temperature-controlled warehouse network and its existing supporting personal property and information technology.
(b) Stock-based compensation expense excludes the stock compensation expense associated with employee awards granted in conjunction with Project Orion, which are recognized within Acquisition, cyber incident, and other, net.

(a) Stock-based compensation expense excludes the stock compensation expense associated with employee awards granted in conjunction with Project Orion, which are recognized within Acquisition, cyber incident, and other, net.

We view and manage our business through three primary business segments-warehouse, transportation, third-party managed. Our core business is our warehouse segment, where we provide temperature-controlled warehouse storage and related handling and other warehouse services. In our warehouse segment, we collect rent and storage fees from customers to store their frozen and perishable food and other products within our real estate portfolio. We also provide our customers with handling and other warehouse services related to the products stored in our buildings that are designed to optimize their movement through the cold chain, such as the placement of food products for storage and preservation, the retrieval of products from storage upon customer request, case-picking, blast freezing, produce grading and bagging, ripening, kitting, protein boxing, repackaging, e-commerce fulfillment, and other recurring handling services.

In our transportation segment, we broker and manage transportation of frozen and perishable food and other products for our customers. Our transportation services include consolidation services (i.e., consolidating a customer's products with those of other customers for more efficient shipment), freight under management services (i.e., arranging for and overseeing transportation of customer inventory) and dedicated transportation services, each designed to improve efficiency and reduce transportation and logistics costs to our customers. We provide these transportation services at cost plus a service fee or, in the case of our consolidation or dedicated services, we may charge a fixed fee. We supplemented our regional, national and truckload consolidation services with the transportation operations from various warehouse acquisitions. We also provide multi-modal global freight forwarding services to support our customers' needs in certain markets.

Under our third-party managed segment, we manage warehouses on behalf of third parties and provide warehouse management services to leading food manufacturers and retailers in their owned facilities. We believe using our third-party management services allows our customers to increase efficiency, reduce costs, reduce supply-chain risks and focus on their core businesses. We also believe that providing third-party management services allows us to offer a complete and integrated suite of services across the cold chain.

• these measures do not reflect our historical or future cash requirements for maintenance capital expenditures or growth and expansion capital expenditures;
• these measures do not reflect changes in, or cash requirements for, our working capital needs;
• these measures do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness;
• these measures do not reflect our tax expense or the cash requirements to pay our taxes; and
• although depreciation and amortization are non-cash charges, the assets being depreciated will often have to be replaced in the future and these measures do not reflect any cash requirements for such replacements.
  

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