Company Highlights - FCPT acquired 64 properties for $199 million at a 71% cap rate in the last 5 months of 2024[7] - The company raised over $102 million in Q4 and $104 million in Q1 to date through ATM[7] - FCPT has $204 million of unsettled equity forwards as of March 17, 2025[7] - The company extended and upsized its credit facility capacity in January 2025, including a $350 million revolver capacity and a $225 million term loan[7] Portfolio Composition - Olive Garden accounts for 34% of the portfolio, while LongHorn represents 10%[7] - The company's portfolio consists of 1220 leases across 163 brands[50, 54] - Darden spin-off properties have 56x rent coverage[15, 18] Financial Metrics - FCPT's net debt to adjusted EBITDAre ratio is 49x[15, 52] - The company's average annual escalator is 14%[52] - FCPT's Q4 AFFO per share is $044[50]

Group 1 - Four Corners Property Trust (FCPT) announced the acquisition of an Olive Garden property for $4.1 million, emphasizing the company's expansion and diversification efforts to support future revenue growth [1][7] - The Olive Garden property is situated in a strong retail corridor in North Carolina and is under a long-term triple net lease, being corporate-operated [1][7] - The acquisition was priced at a cap rate consistent with previous FCPT transactions, indicating a stable investment strategy [1][7] Group 2 - FCPT has a history of acquiring high-quality, net-leased restaurant and retail properties, demonstrating a robust acquisition track record [2] - Recent acquisitions include Tires Plus for $1.7 million, an automotive service property for $5.8 million, and Christian Brothers Automotive for $4.3 million, aligning with the company's strategy to build a resilient portfolio [3][4] - The company's stock performance over the past six months shows a 5.1% gain, compared to a 7.2% increase in the industry, reflecting a competitive market position [4]

Core Insights - Four Corners Property Trust (FCPT) has made significant acquisitions, including a Tires Plus property for $1.7 million and an automotive service property for $5.8 million, both under triple-net leases [1][2][7] - The acquisitions are strategically located in high-traffic areas in Georgia and Texas, with cap rates of 7.4% and 6.8% respectively, which are expected to enhance FCPT's long-term cash flows [1][2][7] - These moves reflect FCPT's ongoing efforts to expand and diversify its portfolio, aiming to support future revenue growth [3][7] Company Overview - FCPT is a real estate investment trust (REIT) focused on acquiring high-quality, net-leased restaurant and retail properties, with a history of successful acquisitions [4] - Recent acquisitions include a Christian Brothers Automotive property for $4.3 million and another automotive service property for $5.3 million, indicating a consistent strategy of growth [4] Strategic Positioning - The recent purchases align with FCPT's strategy to build a resilient portfolio capable of withstanding various economic cycles [5] - However, the company may face challenges due to elevated interest rates, which could increase borrowing costs [5] - Over the past three months, FCPT's shares have decreased by 1.7%, compared to a 0.6% decline in the industry [5]

Core Viewpoint - Four Corners Property Trust (FCPT) is actively expanding its portfolio through strategic acquisitions, which are expected to enhance future revenue growth and secure long-term cash flows [3][5]. Group 1: Recent Acquisitions - FCPT acquired the Christian Brothers Automotive property through a sale-leaseback for $4.3 million, located in a high-traffic retail corridor in Illinois, under a long-term lease guaranteed by the corporate entity [1]. - The company also acquired an automotive service property for $5.3 million, leased to a national operator, located in a highly trafficked corridor in Arkansas, priced at a 6.8% cap rate [2]. - In addition to the above, FCPT acquired four Christian Brothers Automotive properties for $16.9 million and a Caliber Collision property for $4.2 million this week [5]. Group 2: Strategic Focus - These acquisitions reflect FCPT's strategy to build a resilient portfolio capable of withstanding various economic cycles [6]. - The company has a history of acquiring high-quality, net-leased restaurant and retail properties, indicating a consistent approach to growth [4]. Group 3: Market Performance - Over the past three months, FCPT's shares have declined by 4.4%, compared to a 3.3% decline in the industry, suggesting some challenges in the current market environment [6].

Group 1 - Four Corners Property Trust (FCPT) announced the acquisition of three Express Oil Change & Tire Engineers properties for $9.5 million, indicating the company's expansion and diversification efforts aimed at future revenue growth [1] - The properties were purchased at a 6.6% cap rate on rent, secured under a long-term, triple-net lease with approximately 19 years remaining, which will help ensure FCPT's long-term cash flows [2] - FCPT has a history of acquisitions, including the purchase of a Caribou Coffee property for $1.4 million in April 2025, also under a long-term, triple-net lease with about eight years remaining [3] Group 2 - In April 2025, FCPT also acquired properties for Chuy's, Outback Steakhouse, and an automotive service property for $2.9 million, $1.6 million, and $5.3 million respectively, aligning with its strategy to build a resilient portfolio [4] - Over the past three months, FCPT's shares have increased by 2.1%, contrasting with a 2.2% decline in the industry [5] - The broader REIT sector includes better-ranked stocks such as Welltower and Cousins Properties, with upward revisions in their 2025 FFO per share estimates [6]

Group 1 - iREIT+HOYA Capital focuses on income-producing asset classes that provide sustainable portfolio income, diversification, and inflation hedging [1] - The service offers a free two-week trial for potential investors to explore exclusive income-focused portfolios [1] Group 2 - The investment strategy emphasizes accumulating smaller, consistent gains over time rather than high-risk investments [2] - The focus is on defensive stocks with a medium- to long-term investment horizon [2]

[Part I: Financial Information](index=3&type=section&id=Part%20I%3A%20Financial%20Information) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for Q1 2025 and 2024, including balance sheets, income, comprehensive income, equity, and cash flow statements, with detailed notes Consolidated Balance Sheet Highlights (Unaudited) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Total Assets | $2,711,152 | $2,653,026 | +2.2% | | Total Liabilities | $1,278,315 | $1,202,236 | +6.3% | | Total Equity | $1,432,837 | $1,450,790 | -1.2% | Consolidated Statements of Income Highlights (Unaudited) | Metric | Three Months Ended Mar 31, 2025 (in thousands) | Three Months Ended Mar 31, 2024 (in thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenues | $71,476 | $66,467 | +7.5% | | Net Income | $26,186 | $24,074 | +8.8% | | Diluted Net Income Per Share | $0.26 | $0.26 | 0.0% | | Dividends Declared Per Share | $0.3550 | $0.3450 | +2.9% | Consolidated Statements of Cash Flows Highlights (Unaudited) | Metric | Three Months Ended Mar 31, 2025 (in thousands) | Three Months Ended Mar 31, 2024 (in thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $51,560 | $27,625 | +86.6% | | Net Cash Used in Investing Activities | ($58,086) | ($16,449) | +253.1% | | Net Cash Provided by (Used in) Financing Activities | $24,708 | ($9,195) | N/A | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes detail the company's organization, accounting policies, and financial statement items, covering operating segments, real estate acquisitions, debt, derivatives, and segment performance, including the January 2025 credit agreement amendment - The company operates in two reportable segments: **real estate operations** and **restaurant operations** (Kerrow Restaurant Operating Business)[26](index=26&type=chunk)[178](index=178&type=chunk) - In Q1 2025, the company invested **$57.8 million** in **23 properties**, a significant increase from **$16.7 million** invested in **four properties** in Q1 2024[83](index=83&type=chunk)[84](index=84&type=chunk) - On January 31, 2025, the company entered into a Fourth Amended and Restated Revolving Credit and Term Loan Agreement, providing for borrowings up to **$940 million** and extending various maturity dates[103](index=103&type=chunk)[104](index=104&type=chunk) - As of March 31, 2025, **$535 million** of the company's variable-rate debt is hedged by interest rate swaps to manage interest rate risk[121](index=121&type=chunk) - The company has a significant concentration of credit risk, with Darden leases representing approximately **47.0%** of scheduled base rents[76](index=76&type=chunk) - Subsequent to the quarter end, the company invested an additional **$13.2 million** in **five net lease properties**[190](index=190&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial performance, noting an **8.4% rental revenue increase** from acquisitions, higher G&A, and details liquidity, including a new credit agreement and ATM program, with an increase in AFFO per share - As of March 31, 2025, the company's portfolio comprised **1,221 properties** with **99.4% occupancy** and an average remaining lease term of **7.3 years**[198](index=198&type=chunk) - Rental revenue increased by **$4.9 million (8.4%)** year-over-year, primarily due to the acquisition of **106 leased properties** between April 1, 2024, and March 31, 2025[200](index=200&type=chunk) - General and administrative expenses rose by **$1.4 million (23.0%)** year-over-year, mainly due to increased stock-based compensation expense[202](index=202&type=chunk) - The company's financing strategy includes using its **$350 million revolving credit facility** and a **$500 million ATM program** As of March 31, 2025, **$231.9 million** was available for issuance under the ATM program[224](index=224&type=chunk)[225](index=225&type=chunk)[229](index=229&type=chunk) Non-GAAP Financial Measures (per diluted share) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | FFO per diluted share | $0.41 | $0.41 | 0.0% | | AFFO per diluted share | $0.44 | $0.43 | +2.3% | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=50&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes to the company's market risk exposure occurred since fiscal year 2024, with detailed disclosures referenced in the Annual Report on Form 10-K - The company reports no material changes to its quantitative or qualitative market risk exposure since December 31, 2024, incorporating by reference information from its 2024 Annual Report on Form 10-K[241](index=241&type=chunk) [Item 4. Controls and Procedures](index=50&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes identified in internal control over financial reporting during Q1 2025 - Management concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period[242](index=242&type=chunk) - There were no changes in internal control over financial reporting during Q1 2025 that have materially affected, or are reasonably likely to materially affect, internal controls[243](index=243&type=chunk) [Part II: Other Information](index=51&type=section&id=Part%20II%3A%20Other%20Information) [Item 1. Legal Proceedings](index=51&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine legal claims, which management believes will not materially adversely affect its operations, financial condition, or liquidity - The company is party to various claims and legal actions considered routine and incidental to its business, and management does not expect them to have a material adverse effect[246](index=246&type=chunk) [Item 1A. Risk Factors](index=51&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024, have occurred - There have been no material changes to the risk factors as disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[247](index=247&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=51&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - The company reported 'None' for this item[248](index=248&type=chunk) [Item 3. Defaults Upon Senior Securities](index=51&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities during the period - The company reported 'None' for this item[249](index=249&type=chunk) [Item 4. Mine Safety Disclosure](index=51&type=section&id=Item%204.%20Mine%20Safety%20Disclosure) This item is not applicable to the company's business operations - This item is 'Not Applicable'[250](index=250&type=chunk) [Item 5. Other Information](index=51&type=section&id=Item%205.%20Other%20Information) The company reported no other material information, including no director or officer adopting or terminating a Rule 10b5-1 trading arrangement during the quarter - During Q1 2025, no director or officer of the Company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement[251](index=251&type=chunk) [Item 6. Exhibits](index=52&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate governance documents, the new credit agreement, and required officer certifications - Key exhibits filed with this report include the Fourth Amended and Restated Revolving Credit and Term Loan Agreement and certifications by the Principal Executive Officer and Principal Financial Officer[254](index=254&type=chunk)

Financial Data and Key Metrics Changes - The company reported Q1 AFFO of $0.44 per share, reflecting a 2.3% increase from the previous year [22] - Q1 cash rental income reached $63.2 million, representing a 9.1% growth compared to the same quarter last year [22] - The current annual cash-based rent for leases in place is $243.9 million, with a weighted average five-year annual cash rent escalator of 1.4% [22] - Cash G&A expenses, excluding stock-based compensation, were $4.9 million, accounting for 7.7% of cash rental income for the quarter, down from 7.9% the previous year [22][23] - The portfolio occupancy rate stands at 99.4%, with a rent collection rate of 99.5% for Q1 [24] Business Line Data and Key Metrics Changes - The company closed $70 million in acquisitions at a blended cap rate of 6.7% during Q1, marking the highest acquisition volume for a first quarter in the company's history [5][6] - A total of 23 properties were acquired for $57 million at a blended cap rate of 6.7%, with a weighted average lease term of 17 years [14] - The largest tenants include nationally branded restaurant operators, with significant same-store sales growth reported for brands like Chili's and Olive Garden [9][10] Market Data and Key Metrics Changes - The company has seen no material changes in cap rates for recently priced deals, indicating a stable market environment [6] - The portfolio has diversified significantly, with Darden's contribution to rent dropping from 100% to 47% [10] - The company has a strong liquidity position with approximately $617 million available for funding acquisitions [21] Company Strategy and Development Direction - The company aims to continue building its acquisition pipeline while maintaining high-quality asset selection and credit standards [15][18] - The focus remains on acquiring properties from well-capitalized operators, particularly in sectors with low tariff exposure [12][68] - The company is enhancing its underwriting capabilities and exploring new technologies to improve efficiency [81][84] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the portfolio's resilience amid potential economic downturns, citing strong rent coverage and high occupancy rates [12][68] - The company is well-positioned to navigate macroeconomic uncertainties, with significant liquidity and no near-term debt maturities [20][21] - Management noted that while they expect some pullback in tenant performance during a recession, the portfolio's structure provides a cushion [12][68] Other Important Information - The company has raised $475 million in equity through its ATM program since July of the previous year, achieving the lowest leverage levels in seven years [7] - The company has made significant progress in managing lease maturity profiles, with 88% of 2025 maturities already extended or indicating intent to do so [23] Q&A Session Summary Question: Is the slight yield compression due to increased competition for assets insulated from tariffs? - Management indicated that the majority of yield compression is related to the high percentage of QSR restaurant acquisitions in the quarter [25] Question: What is the governor on growth given the strong acquisition volumes? - Management stated that the type of acquisitions being pursued largely determines quarterly buying capacity, emphasizing quality over quantity [28][29] Question: How do you monitor the health of Burger King tenants after a franchisee bankruptcy? - Management clarified that the bankruptcy was a specific issue related to that franchisee and does not reflect broader concerns [35] Question: What is the range of EBITDAR coverage ratios for recent acquisitions? - Management noted that while they do not disclose coverage ratios quarterly, credit metrics are similar across industries, with coverage typically being three times or more [54] Question: How does the company view potential opportunities in a recession? - Management expressed confidence in the portfolio's performance during downturns, noting that they are well-capitalized and focused on finding high-quality deals [67][68]

Financial Data and Key Metrics Changes - The company reported Q1 AFFO of $0.44 per share, reflecting a 2.3% increase from the previous year [23] - Q1 cash rental income reached $63.2 million, representing a 9.1% growth compared to the same quarter last year [23] - The portfolio occupancy rate stands at 99.4%, with a rent collection rate of 99.5% for the first quarter [25] Business Line Data and Key Metrics Changes - In Q1, the company acquired 23 properties for $57 million at a blended cap rate of 6.7% with a weighted average lease term of 17 years [14] - The largest tenants include nationally branded restaurant operators, with significant same-store sales growth reported for Chili's (31.6%) and Olive Garden (12.6%) [8][9] - The company has diversified its portfolio, reducing Darden's contribution from 100% to 47% of the rent roll, with the top five brands now accounting for 55% of annual base revenue [9] Market Data and Key Metrics Changes - The company has not observed significant changes in cap rates for recently priced deals, indicating stable market conditions [6] - The majority of annual base rent (67%) comes from casual dining, with 11% from quick service and 11% from automotive services [10] Company Strategy and Development Direction - The company aims to maintain a disciplined acquisition strategy, focusing on high-quality assets and avoiding sectors with high tariff exposure [12][18] - The management emphasizes transparency and best-in-class disclosure, providing detailed insights into tenant exposures and acquisition strategies [13] Management's Comments on Operating Environment and Future Outlook - Management believes the portfolio is well-positioned to weather potential economic downturns, citing strong rent coverage and high occupancy rates [12][70] - The company is optimistic about its ability to capitalize on acquisition opportunities, despite macroeconomic uncertainties [72] Other Important Information - The company has raised $475 million in equity since July of the previous year, achieving its lowest leverage levels in seven years [7] - The fixed charge coverage ratio is reported at a healthy 4.4 times, indicating strong financial stability [22] Q&A Session Summary Question: Is slight yield compression due to increased competition for assets? - Management indicated that the majority of yield compression is related to the high percentage of QSR restaurant acquisitions in the quarter [26] Question: What is the governor on growth and pipeline outlook? - Management stated that the type of acquisitions being pursued largely determines growth, with a strong pipeline currently in place [28][30] Question: How do you monitor the health of Burger King tenants? - Management clarified that recent issues were specific to a particular franchisee and not indicative of broader problems [36] Question: What is the range of EBITDAR coverage ratios for recent acquisitions? - Management noted that while they do not disclose coverage ratios quarterly, credit metrics are fairly similar across industries [53] Question: How does the company view potential opportunities in a recession? - Management expressed confidence in the portfolio's performance during downturns, emphasizing readiness to deploy capital for high-quality deals [70][72]

Financial Highlights - FCPT's annual base rent has grown 2.6x from $94 million in 2015 to $244 million in Q1 2025[8, 12] - The company's enterprise value has increased 3.1x from $1.3 billion in 2015 to $4.1 billion in Q1 2025[8, 10] - FCPT raised $102 million in Q4 2024 and $169 million year-to-date in 2025 through ATM [7] - FCPT has $254 million of unsettled equity forwards as of April 30, 2025[7, 17] - The company has $350 million undrawn revolver capacity[7, 17] - FCPT reported AFFO per share of $0.44 in Q1 2025[15] Portfolio Composition - Olive Garden accounts for less than 34% of Annual Base Rent (ABR)[7, 28] - LongHorn Steakhouse accounts for less than 10% of ABR[7, 28] - The top five brands now represent less than 55% of ABR[7, 8] - The portfolio is 99.4% occupied[17, 33]